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As an employer, you pay quarterly social security contributions to the NSSO, but did you know that you may be eligible for a target group reduction? This means a significant reduction in your wage bill for several quarters. However, there will be some changes to certain existing target group reductions in Flanders in the coming period. In this blog, we list all the changes.
The first amendment concerns the Flemish target group reduction for older workers. If you take on someone over the age of 58 who has been registered with the VDAB as a jobseeker for at least one day, you will still be able to enjoy a full exemption from the basic contributions for the next two years. In addition, a reduction also applies when the employee you employ reaches a certain age. This is currently at 60 years of age. From the quarter of your employee’s 60th birthday onwards, you will receive a maximum quarterly discount of € 600. When your employee reaches the age of 62, the reduction increases to € 1,500 per quarter. The starting age for the reduction for ‘incumbent workers’ will be raised to 61 from 2024, with the higher reduction of € 1,500 remaining possible for 62-year-olds.
In addition, Flanders is reforming regulations to give persons with labour disabilities more opportunities in the labour market. Employers who hire such individuals can enjoy subsidies today. These subsidies – in particular The Flemish Support Premium (VOP), the Social Involvement Economy (Sine), the Local Service Economy (LDE) and the Customisation Departments (MWA) – of collective customisation are disappearing. From 1 July 2023, every employer will be able to welcome such persons with work-related disabilities into the workplace through individual customisation. Any person, jobseeker or employee, who has a work restriction can have it identified by the VDAB. If, as an employer, you recruit a person who can produce such a certificate from the VDAB, the loss of earnings of that person or costs you incur due to adjustments to the workplace because of the employment of this person will be reimbursed. As an employer, you then claim a wage premium and/or guidance premium.
From 1 October 2023, the existing "recruitment incentivefor long-term jobseekers" will be replaced by a new reduction in social security contributions for "recruitment of persons without recent sustainable work experience". Besides an expansion of the target group, this new rebate will no longer be via a one-off premium that the employer must apply for and receive in two instalments. The new premium would be through direct reduction of employer contributions through the quarterly return. Further grant modalities such as duration, lump sum and wage limits still need to be further elaborated by the Flemish government.
On 7 October 2022, the Flemish government approved a decree regarding a new premium for qualifying workplace learning. This new premium replaces existing measures such as the target group reduction for apprentices in work-linked training and part-time vocational training, as well as the mentor discount and the start-up and internship bonus. These four existing workplace learning incentives will be abolished from 1 September 2023, and replaced by the new qualifying workplace learning premium. This aims to encourage companies with headquarters in the Flemish Region to offer quality apprenticeships. However, the Flemish government still has to work out some implementation modalities such as the level of the new premium, among others.
A final change concerns a curtailment on federal target reductions for first-time recruits. From 1 January 2024, the amount of the NSSO reduction will be capped at € 3,100 per quarter, instead of the current € 4,000 per quarter. The reduction does remain valid indefinitely over time. This reduction of the reduction amount to € 3,100 per quarter will also apply from 1 January 2024 to the reductions of a first employee hired before 1 January 2024. Moreover, the NSSO reduction for the fourth, fifth and sixth hires will disappear from 1 January 2024. For reductions that took effect before 1 January 2024, the current rules continue to apply.
Our experts are ready to inform, advise and support you.
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