21.01.2021
The most important things you need to know about self-insurance
Usually, when we hear that someone is self-insured, we understand that he pays his own insurance. Unlike the employees under an employment contract, for whom the employer takes care to pay all taxes and insurances to the state.
These associations and understandings on the subject of "self-insurance" are correct, but according to the legislator the term self-insured persons refers in particular to the following categories:
- persons registered as exercising a free profession and/or craft activity;
- persons engaged in labor activity as sole traders, owners or partners in commercial companies and natural persons - members of impersonal companies;
- registered farmers and tobacco growers.
Unemployed persons who (a) are not registered with a labor office or (b) have already received the unemployment benefit to which they were entitled and no longer receive money from the bureau are also considered as self-insured persons for the purposes of health insurance. on labor. These people have to pay their monthly health contributions themselves, which is why they are considered self-insured.
The liberal professions "freelancers"
And if you have wondered exactly which professions are considered free, the answer is in item 29 of §1 of the Additional Provisions of the Personal Income Tax Act (PITA). According to the definition given there, "freelancers" are: chartered accountants; consultants; auditors; lawyers; notaries; private bailiffs; jurors; experts to the court and the prosecution; licensed appraisers; industrial property representatives; medical specialists; translators; architects; engineers; technical managers; figures of culture, education, art and science; insurance agents; other natural persons for whom the following conditions are simultaneously met:
(a) carry out a professional activity at their own expense;
(b) are not registered as sole traders;
Self-insured persons are not entitled to unemployment benefits, accidents at work and occupational diseases.
Basic obligations and features
- Registration as a self-insured person with the NRA
Within seven days from the start of an activity that qualifies the person as self-insured, he must submit a declaration of registration to the NRA. It informs the revenue agency about the risks for which it will be insured. In all cases, the person is insured for disability due to general illness, old age and death (i.e. pension) and can choose whether to be insured for general illness and maternity. In practice, this means that self-insured persons do not pay social security contributions and are therefore not entitled to unemployment benefits, accidents at work and occupational diseases. The choice of insurance risks may be changed until January 31 of the following calendar year.
Unemployed people must also declare that they have remained unemployed and will pay their own health contributions. This is again done with a declaration on an approved form, which is submitted to the NRA by the 25th of the month following the month in which the person has grounds to pay their own health contributions.
- Declaration to the payer of the income
Every self-insured person must declare to the persons from whom he receives income that he is a self-insured person in order not to be deducted from insurance and tax. Otherwise, if there is no such declaration, the person who pays any remuneration to the self-insured must deduct from this remuneration the due tax and insurances.
- Payment of insurances, insurance income
As already mentioned, all due social security contributions are at the expense of the person and he must pay them himself. The minimum and maximum insurance income on which the insurance contributions are calculated are determined in the State Social Insurance Budget Act for the respective year.
For 2021, the minimum monthly amount of the insurance income for the self-insured persons is BGN 650. The minimum monthly amount of the insurance income for the registered farmers and tobacco producers remains at BGN 420.
The maximum monthly amount of the insurance income is BGN 3,000.
- Advance tax, annual tax return and annual tax
Self-employed persons must pay an advance tax, as well as fill in and file an annual tax return. The way in which the tax base for calculating the tax is determined is regulated in the Personal Income Tax Act and depends on the specific activity performed and respectively on the type of income (whether it is in the form of royalties, whether it is a craft or a free profession and other).
- Documentation
Some of the categories of self-insured persons are obliged to register and report their sales of goods and services in a retail outlet by issuing a fiscal or system voucher in accordance with Ordinance №H-18 for registration and reporting of sales in retail outlets through fiscal devices.
Even self-employed persons exempted from the obligation to issue fiscal or systemic vouchers (for example, those exercising liberal professions or trades) must issue a document on their income (unless, for example, the payer has not issued them the so-called document "account for amounts paid"). The document must contain certain requisites provided for in the Accounting Act, and the non-issuance of a document with the necessary content may lead to the imposition of fines for each individual unissued document.
As can be seen, self-insured persons have much more obligations to take care of than employees, where the employer is obliged to perform all activities of declaring, withholding and paying social security contributions and taxes.
However, there are professions in which there is no choice whether to work in an employment relationship or to be a self-employed person. For example, due to the nature of their profession, lawyers, notaries, private bailiffs and many others are not allowed to work under an employment contract. Thus, in practice, the choice is predetermined for them, whether they like it or not.
Of course, on the other hand, self-insured persons do not depend on whether their employer has paid all due social security contributions and taxes or whether he has correctly declared the necessary information in order to subsequently receive the benefits or other rights that are due to them. Self-employed persons manage all these processes themselves and, accordingly, if they are well acquainted with the legal requirements and deadlines, they can rest assured that when they need them, they will get what they deserve.
20.01.2021
400,000 people have lost their jobs since the pandemic began
More than 400,000 people have lost their jobs since the beginning of the Covid pandemic in Bulgaria at the beginning of last year. This is shown by the latest data of the NSI and the Employment Agency.
In the week of January 11-17 alone, 7,600 people registered with the Labor Offices, and the number of people employed through the offices is almost twice as low - 3,600.
For the period from February 3, 2020 to January 17, 2021, the newly registered unemployed in the Labor Offices are a little over 404 thousand people. For the same period, 244 thousand people started working through the Labor Offices throughout the country.
Of all the registered unemployed, most are in Sofia district - over 46 thousand people. In second place is Plovdiv district with 34 thousand people, followed by Blagoevgrad, Burgas and Varna with unemployed in the range between 26 thousand and 28 thousand people.
20.01.2021
Google funds digital inclusion projects in Bulgaria and Romania
Google today launched the first initiative of its kind in Central and Eastern Europe, the Google.org Impact Challenge. A session for applying for funding for projects to help bridge the digital divide and promote inclusive economic growth has been launched. Google will distribute 2 million euros in grants to selected organizations from Bulgaria and ten other countries in the region in support of their charity projects.
Technology has been the lifeline for European business and communities throughout the pandemic, from helping people find accurate health information and buy groceries online, to finding new ways to learn and connect with loved ones. This underlined the need to create an accessible digital future for all, especially as economies embark on the road to recovery.
That's why Google is committed to helping achieve that goal. Last year, Google pledged to help 10 million people and companies across Europe, the Middle East and Africa digitize, grow and build new careers. Specifically in the CEE region, we have already helped 250,000 people develop their digital skills or move to a digital career in 2020 alone. In Bulgaria, more than 20,000 companies and individual participants took a digital skills course under the Grow with Google Digital Garage program, for the entire period of the program.
Google is now looking for initiatives aimed at rebuilding the socially inclusive economy. All non-profit organizations, companies and academic institutions from Bulgaria can apply until March 1, 2021, at g.co/ceechallenge. Projects must be charitable and can be large or small and at any level of preparation - whether it is a new idea or an established project ready to scale. Applicants must be established in one of the following countries: Bulgaria, Estonia, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia, Hungary, Croatia, the Czech Republic.
"Nowadays, the economic effects and acceleration of technology due to the Covid-19 pandemic put a lot of pressure on us. It can be difficult to adapt if we lack the resources or skills to respond to change. That is why it is more important than ever to bridge the digital divide and support inclusion. I am confident that the Google.org Impact Challenge will help organizations in Bulgaria meet these challenges and I look forward to helping you choose the most effective offerings. I share the goal of the initiative to build digitally sustainable and prosperous societies," said Gergana Passy, President of the Digital National Alliance, Bulgaria.
The Impact Challenge initiative is another proof of Google's commitment to Bulgaria and CEE in support of charity and projects aimed at improving education and economic opportunities by enhancing digital skills. Last year alone, Google.org provided more than 1.5 million euros in individual grants to several charities in the region in support of the cause. In 2018, Google.Org provided grant funding for a project conducted jointly with the Ministry of Education and Science in Bulgaria to increase the digital skills of teachers in the basic course of study in Bulgarian schools.
The supported projects will be selected by Google with the help of a panel of respected experts from the INCO group, which includes people of science, leaders and civil society activists from across the region.
20.01.2021
They pay the money to closed businesses next week
More than 6,000 traders have sought working capital support so far through the National Revenue Agency.
Under this scheme, traders affected by anti-epidemic measures imposed by 4 orders of the Minister of Health can receive 20%, respectively. 10% of its turnover for the respective periods of 2019 or 2020.
The application deadline is 4.30 pm today, January 20.
The grant will be awarded within 7 days of the approval of the project proposal. The payment of the sums will start next week, and the revenue agency is expected to pay over BGN 30 million to the companies' accounts by January 28.
The expected approval from the European Commission was received late last night, which opens the possibility for business support, added the NRA.
So far, more than 80% of the project proposals have passed automated software testing, and more than 3,200 companies have received preliminary approval for financial assistance for over BGN 36 million.
For the other persons, who have submitted an application for financial support, additional checks are already carried out by the revenue inspectors in the National Revenue Agency on the declared data for establishing their eligibility and compliance with the application conditions. The total amount of the requested support is BGN 89 million.
Among the applicants there are those who do not meet the requirements, as the most common violations are declaring turnover for a period of 2 months, which is greater than the VAT declarations indicated in the reports, as well as requesting financing of sites and companies, which are not directly affected by the orders of the Minister of Health.
Additional information about the conditions for application and the mechanisms for granting the aid can be obtained in the special section on the website of the NRA - https://nap.bg/page?id=799 or on the phone of the information center of the NRA 0700 18 700.
19.01.2021
Innovations in taxes and insurance for 2021 (updated)
In December, several issues of the State Gazette published changes for 2021 in accounting, taxes and insurance. Below from the Consultancy Center - Berkovitsa we summarize the most important changes in a structured way.
Extended deadlines for filing returns and paying taxes
The deadlines for filing the annual tax returns of enterprises have been extended. They will be submitted from March 1 to June 30 next year. This applies to the declarations under Art. 92 of CITA and under Art. 50 of the Personal Income Tax Act for sole proprietors and registered farmers. The taxes on them will be paid in the same term.
The deadlines for publishing the annual financial statements are extended until September 30 of the following year, and for the declaration of inactivity - until June 30 of the following year. The extended deadlines also apply to the annual accounting closing for 2020.
Individuals who file their annual tax return by March 31 of the following year electronically enjoy a 5% discount on the top-up tax, provided that they have no enforceable public obligations at the time of filing the return and the top-up tax has been paid. by March 31. The total amount of the used discount cannot exceed BGN 500.
Advance payments for corporate tax
Advance payments are made on the estimated tax profit for the respective year as before, but to determine whether advance payments will be made, the net sales revenues for the year before the previous year are taken into account.
Taxpayers are required to submit a new declaration in a form for declaring advance payments within 1 March to 15 April.
The deadline for paying the last advance payment on December 1 is changed, instead of December 15. A new deadline of November 15 for submitting the declaration under Art. 88 of CITA for changes in advance payments. The admissible excess of the corporate tax over the determined advance payments is changed from 20% to 25%.
Retail Sales Management Software (SUPTO)
The use of SUPTO is entirely voluntary. Persons who use SUPTO from the list of the NRA will benefit from certain tax benefits as follows:
1) They will have the opportunity for accelerated repayment of a tax credit within 30 days from the submission of the reference-declaration (effective from 12.12.2020).
2) In case of a first violation for non-issuance of a fiscal receipt, they will not be required to apply a compulsory administrative measure “sealing of a commercial site” (in force from 12.12.2020)
3) They will be able to depreciate rapidly with the annual tax depreciation rate up to 100% the following tax depreciable assets of category VI (including when determining the tax financial result for 2020):
For those who have chosen SUPTO, it is important to note the following new VAT sanction:
A person who has chosen to use SUPTO from the NRA list in a commercial site, but who nevertheless uses other software not included in the NRA list, is fined - for individuals who are not traders, in the amount of BGN 1,000 to 3,000 ., or a property sanction - for legal entities and sole traders, in the amount of BGN 5,000 to 10,000. In case of repeated violation, the amount of the fine is from BGN 2,000 to 6,000, and of the property sanction - from BGN 10,000 to 20,000.
On cost taxes
Exemption from taxation of social expenses for contributions and premiums for additional social insurance and life insurance will be available only if at the end of the month during which the expenses are accrued, the liabilities are not reflected in the tax-insurance account or are not recorded as claimed for enforcement in the National Revenue Agency.
The tax-free amount of food vouchers has been increased from BGN 60 to BGN 80 per month, provided in the form of food vouchers to each employee.
New tax relief in connection with repairs and improvements
A new tax relief for individuals is introduced, deducting from the total annual tax base the payments made during the year for work in connection with improvements and / or repairs of a real estate in the total amount of up to BGN 2,000 when the following conditions are met:
Important: The relief is applied to income realized after 01.01.2021.
Increased tax relief for children
The amounts for the tax reliefs for children are significantly increased for 2021, as follows:
- BGN 4,500 for one child;
- BGN 9,000 for two;
- BGN 13,500 for three or more children;
- for a child with disabilities - BGN 9,000.
Until now, these dimensions were:
- BGN 200 for one child;
- BGN 400 for two;
- BGN 600 for three or more children;
- for a child with disabilities - BGN 2,000.
Important: The new amounts of benefits apply only to income realized in 2021.
Administrative relief for individuals
Natural persons who are not sole proprietors or self-insured persons will not be obliged to issue a document for their income if they have received the amounts by bank transfer, or the income is subject to final tax, or the income is exempt from taxation as received from rent, lease or other remunerative provision for use of agricultural land, or when the payer issues an "Invoice for paid amounts".
Salaries
The amount of the minimum wage for the country (minimum wage) is increased to BGN 650.
In 2021, the period of unpaid leave of up to 60 working days will be considered as insurance length of service.
Social security
The minimum monthly amount of the insurance income for the self-insured persons is increased to BGN 650 and respectively:
The minimum insurance income and the contributions to the Accident at Work and Occupational Disease Fund are changed.
The following are saved:
New sanction in the TSSPC related to the application of DTT without grounds
Effective from 01.01.2021, which does not pay or pays a smaller amount of tax in accordance with the Corporate Income Tax Act or the Personal Income Tax Act within the established deadline for payment of the tax, without certifying the grounds for application of DTT, shall be punished by a fine - for natural persons, or by a property sanction - for legal entities and sole traders, in the amount of 5 per cent of the amount of unpaid tax, but not more than BGN 15,000. natural persons or property sanction for legal entities and sole traders in the amount of 10 per cent of the amount of the unpaid tax, but not more than BGN 30,000.
Food and VAT
The reduced VAT rate of 9% also applies to home delivery of food from 01.12.2020 to 31.12.2021.
Distance sales under VAT
in force from 01.07.2021
In connection with Directive (EU) 2017/2455 and Directive (EU) 2019 / 1995B, new rules and regimes are introduced in the VAT Act, concerning supplies to recipients of non-taxable persons in the EU. Briefly the following:
1) Intra-Community distance sales of goods within the EU (Article 14, paragraph 1)
Until 31.12.2020, this is a distance selling mode.
2) Distance sales of goods imported from third countries or territories (Article 14, paragraph 3)
The goods are dispatched or transported from third countries or territories from the supplier to the consignee (non-taxable person) in a Member State.
3) Domestic distance sales (Art. 14a, para. 5, item 3)
The goods are dispatched or transported to the territory of the same Member State by a taxable person not established in the territory of the European Union.
4) Deliveries facilitated by an electronic interface (Article 14a)
An electronic interface is a device or program that allows communication between two independent systems or a system and an end recipient and may include a website, portal, platform, application interface, and other similar means.
5) Rules for import of goods under a special regime for distance sales of goods imported from third countries or territories and a special regime for declaration and deferred payment of import tax shall also be introduced. They refer to consignments with an intrinsic value not exceeding the BGN equivalent of EUR 150, excluding excise goods, for non-taxable persons who are established, have a permanent address or habitual residence in a Member State, including in the country.
There are also changes in the Non-Union Regime and the Union Regime, as their scope from 01.07.2021 is extended to all other services provided to non-taxable persons established in the EU. The regime in the Union includes, in addition to the supply of services, intra-Community distance selling of goods and domestic distance selling of goods.
With the extension of the scope of supplies, individuals will declare and pay VAT in only one Member State, regardless of where the tax is due. This eliminates the obligation to track turnover for distance selling and the corresponding registration in another Member State.
Taxable persons who are registered to apply a non-Union and non-Union regime may continue their registration for a Union or non-Union regime by submitting an application electronically to update the data in the initial application for registration submitted. , from 1 April 2021 to 30 June 2021
A threshold of EUR 10 000 is introduced to determine the place of performance for supplies of intra-Community distance sales of goods and supplies of telecommunications services, radio and television broadcasting services and electronically supplied services to non-taxable persons. , if the provider, including who manages the electronic interface, is established, has a permanent address or habitual residence in the territory of only one Member State.
Until this threshold is reached, deliveries shall take place in the supplier's Member State. After exceeding the threshold - deliveries have a place of performance in the country of consumption. The condition that the total value excluding VAT of supplies does not exceed in the current calendar year and did not exceed in the previous calendar year EUR 10,000 or their equivalent in the national currency of the Member State in which the supplier is established.
Brexit
After 31.12.2020, the date of expiry of the transitional period under Article 126 of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community, the VAT identification numbers of UK traders starting with prefix “GB” will not be valid for the purposes of intra-Community trade and it will not be possible to verify their validity through the European Commission's VAT number verification site here.
As of 1 January 2021, traders in Northern Ireland who trade in goods within the European Union under the Ireland / Northern Ireland Protocol will be issued with VAT identification numbers beginning with the prefix "XI". The validity of these numbers can be checked on the website of the European Commission.
After the end of the transitional period - 31.12.2020, the provisions of Union law in the field of VAT will no longer apply to the United Kingdom or its territory, and from 01.01.2021 the Kingdom is a third country. Under certain conditions, the supply of goods to and from Northern Ireland will be treated as GP, respectively APR. There are special clauses for the treatment of persons from the United Kingdom of Great Britain and Northern Ireland, who are registered under Art. 97b of the VAT Act in connection with registration under Art. 96, para. 9 or deregistration, the refund of VAT, as well as the treatment of the supplies for which the transport starts before 01.01.2021 and ends after this date.
19.01.2021
How "Yale's Most Popular Lecture" changed the way you spend your money
"You can't buy happiness with money." For most of my life, I believed that this idea could not be justified. Anyone who says that a million dollars will not make them happier is probably mistaken, writes Dave Schools.
Money gives you more control over your life, the freedom to retire early, the security to support yourself and your family, the comfort of buying things and experiences that excite you, the ability to say yes when your friends invite you to dinner ... and the list could go on and on.
So when Yale posted his lecture on happiness for free online, Scholes decided to give it a try.
The New York Times called it "the most popular lecture in university history," and hundreds of people who reported changes in life after it convinced me. Maybe it will change the way I spend and think about money,” says Scholes.
The 10-week course, entitled Welfare Science, is led by Lori Santos, a professor of psychology and cognitive science. She begins the lesson by asking why what we want in life doesn't really make us happy.
The culprit is a phenomenon called "wrong desires" and refers to the idea that people sometimes "incorrectly predict" how much they will enjoy something in the future.
Money is happiness. Is it?
Santos mentions several "annoying traits of the mind" that make us pursue things that don't really make us happy. Many of the materialistic goals we pursue have little or no effect on our overall satisfaction with life, Santos said. One of the main misconceptions he turns to is money.
To prove his point, Santos cites a well-known Princeton study from 2010. Researchers analyzed the responses of 450,000 Americans who were interviewed about things like their income and whether they live the best possible life for them. The data show that while happiness does grow with income, the correlation peaks at about $ 75,000 a year.
The problem with this study, however, is that it was published almost a decade ago. Since then, the idea that money does not buy happiness has been refuted by a number of researchers. For example, a 2012 study by the Skandia International Wealth sentiment Monitor found that global "happiness income" was much higher at $ 160,000.
And a more recent Harvard study from 2018 found that "great wealth really predicts greater happiness" - for millionaires. The researchers found, "consistent evidence that several higher levels of wealth are not associated with higher wealth, but significantly higher levels (net worth $ 8 million or more) are associated with modest wealth." Although most of us are not millionaires, there is still enough data to suggest that happiness is to some extent related to money.)
When Scholes asks Santos what he thinks of research, she replies, "They are important, but I don't think they change the idea of the lecture, which is that high wealth has little effect on happiness. The key is that it's much less than we anticipate, and it's much less effective than the other methods we offer."
Practices such as meditation, gratitude, and creating time for social connections have the greatest impact on our well-being, she says, adding that they are much easier to achieve than trying to break the $ 10 million mark.
Santos continues: "Money does not increase happiness the way we think. Our minds lie to us about the impact that extra money will have on our happiness.
Be more careful about how you spend your money
Later in the lecture, Santos interviewed Elizabeth Dunn, a researcher on happiness and co-author of the book Happy Money. They discuss why spending money on experiences, not things, makes us happy.
But don't things create emotions? And don't you need money to buy these things?
"Driving on a picturesque highway makes me happy, so I spent thousands of kilometers in the car. The trip makes me happy, so I spent thousands of dollars on tickets - not to mention a hotel, food and excursions," said Scholes.
Santos's answer to this question is: "It depends on the circumstances. If you can be careful about how the new car feels when you drive it, given the music, how well it moves, etc., the new car can feel like an experience.”
Well, it makes a little more sense: it's more of a compromise. Money can make us happy if we focus on buying things that generate the same positive experience over and over again.
New and often short experiences, such as the expensive garment you will not wear every day, are less susceptible to hedonistic adaptation. The goal is to keep the happiness of fading.
New goal: to change your way of life and your way of thinking
Santos concludes the lecture as follows: "So does money really make us happier? Maybe to some extent. Maybe if you're in the United States and you only make $ 10,000 a year, then yes, more money will make you happier.” For others, however, more money won't matter.
"Overall, her lectures have changed the way I think about money, especially how I spend it and how much I give it priority. I am also working to change my lifestyle and thinking. Although there is no panacea for happiness, what helps the most is that I take action where I personally miss it,” says Scholes.
Santos advises experimenting with different practices to see what works better. A few months after completing the course, Scholes says what he has discovered so far and that these practices and changes in thinking are surprisingly life-changing:
"Am I completely convinced that money will not make me happy? Absolutely. It will take a lot of effort on my part, but I'm working on it - and it's a pretty significant leap compared to my old self," says Scholes.
19.01.2021
Study: Teleworking in Europe in 2030
The dGen Institute gives a detailed picture of what the continent's labor market would look like in nine years
Going back 100 years, we can see what are the most significant global changes in the labor market. The economies of the eighteenth and nineteenth centuries evolved from predominantly agricultural to productive in the twentieth century, after the end of the First World War. We call the third stage of development the "Technological Age" or the period of the middle of the twentieth century, in which humanity entered an economy based on information technology.
Today, just over 4% of the world economy is created by agriculture, nearly 23% by production, and more than 70% by the services sector. Although some of the positions in the service business cannot be performed completely remotely (such as those in the hotel and restaurant industry), most of the employment in the field has this opportunity. Most people around the world have abandoned offices and adapted to home office work, a phenomenon that has been going on for nearly a year. If in the past telework did not exist due to the lack of cheap and effective ways of communication for employers, now it is not. The phenomenon has the potential to consolidate the fourth epoch-making change in the global labor market, as teleworkers continue to increase.
A detailed study by dGen, an independent non-profit research institute focused on how blockchain technology can contribute to a decentralized future in Europe, predicts what the continent's telecommuting will look like in 2030. Until now, staff recruitment has taken place mainly on site. We are seeing a sharp change in this regard - due to the Covid-19 crisis, most employees have significantly greater opportunities to work remotely, and employers have found that they have serious access to talent from other countries.
How labor needs have changed
However, companies that build a remote organizational culture are still looking for ways to optimize their recruitment costs. This is due to the fact that it is difficult to create a job advertisement that is noticed in all countries. In order to achieve the effect of demand, the costs of building and developing an employer brand have increased significantly for this type of company. At the same time, the biggest job search platforms have added the "remote" option to their ads. For example, at the moment careerbuilder.com, a platform with offices in the USA, Canada, Europe and Asia, can find about 26,000 current job offers offering work from home.
Among developers in the IT sector and designers traditionally have the largest number of remote workers - according to a study by the European Commission in 2018. For them not recently there are specialized platforms with job postings. There are now online platforms for freelancers. Many sectors are experiencing the need for closely targeted international recruitment sites, precisely to make it easier to reach anywhere in the world, at the expense of less.
Carlos Gomez, Talent Manager at CryptoRecruit, the world's first cryptocurrency and blockchain recruitment company, told the study that conflicts between business owners and directors are emerging due to the need for global changes in the labor market. and Human Resources specialists.
... Even after decades of experience, most of them (ed. Recruitment specialists) are still struggling to find talent within the new (remote) labor market dynamics.
How teleworking will change the urban and rural environment
As competition for jobs and talent increases, it may also affect corporate hierarchies and the geographical distribution of management and executive teams. Access to a wide variety of employees in Europe will affect socio-economic processes in both urban and rural areas.
The observations so far outline a trend in which the main prerequisite for starting work will be access to an Internet connection. This will allow companies to reduce their overhead costs and those for renting large offices, and instead will be able to set up headquarters in small settlements without destroying urban areas with thousands of employees and increased traffic. In Bulgaria, for example, at the beginning of the state of emergency there was an increased interest in rural areas and housing by young people. Something that until now was typical for people of pre-retirement age. If the trend continues, it is very possible to start rural development at the expense of cleaner and calmer cities. Although the scale of the digital workforce in Europe is not yet clear, it can be expected that the migration of young people to work on the continent will decrease.
Can the trends in Eastern Europe be reversed?
The authors of the study comment that despite the spread of the practice of telework, in fact there will not be many countries that will enjoy employment growth. The conclusion is based on a study by the global consulting company McKinsey. Emphasis is placed on countries in Eastern Europe, where the population is aging and emigration is high. This is a prerequisite for shrinking labor supply and reducing demand. A problem whose solution, according to the authors, must be sought by the European Union. The creation of a pan-European labor market, with an appropriate internet infrastructure, would compensate for the negative trends. In this part of the continent, it is lagging behind in remote work options, and the concept of "brain drain", which is forcing many young, highly educated people to leave their country for better opportunities in another, is typical of the whole of Europe. The global labor market would help reverse this process. If this happens, skilled workers who can work remotely will increasingly choose to stay in their country, which will contribute to greater social equality across Europe, as location will no longer be decisive for pay.
Freelance work
There are more and more freelancers in Europe, with the number of so-called freelancers doubling from 2000 to 2014, according to the survey. Against this background, as a result of the coronavirus crisis, there is a 25% increase in demand for such positions only for the period April - June 2020, according to the report "Fast 50" by Freelancer, the largest online market for freelance and crowdsourcing, (outsourced services to online users) users and projects. This type of employees is the segment with the highest share of teleworkers, but their work is often accompanied by short-term contracts, a large number of clients and a lack of financial security.
It is expected that more and more people will work for several companies at the same time, because remote work allows it. However, tax systems and laws in many countries deprive this type of employee of many social and legal benefits, so countries will have to adapt to the growing number of such workers. The development of these work models can lead to the equalization of the benefits and rights of freelancers with those of employees on permanent employment contracts.
Pay
Now working for a foreign company remotely can receive a salary that meets the standards of the employer state. However, the development of remote work can allow employers to determine the salaries of their employees in different countries, according to the standard of living there. That's what Gitlab, one of the largest remote companies, is doing. However, the model has both supporters and opponents. On the one hand, this type of remuneration guarantees all employees performing the same role, the same standard of living. On the other hand, the argument that it is not fair for two employees providing the same service to receive different salaries is equally important.
The large-scale survey predicts that in 2030, 27% of the workforce in major European cities will be able to work fully remotely, which will affect both the labor market and migration. There are nine years left to see if this is the direction of humanity or a snapshot of the situation around the coronavirus crisis, but one thing is for sure - technology is driving humanity and the above trends sound very realistic.
15.01.2021
Brexit: What BG companies that trade with the Island should know
Here are some important things that Bulgarian companies that trade with the Island after the UK leaves the European Union should know, writes Trud bg.
There are no obstacles in front of the raw materials - honey, fuels, sunflower. Furniture, clothing, plastics - no duties and non-tariff barriers. Electronics, electrical engineering, machinery - there are no customs duties, but it will probably be necessary to issue new certificates of conformity, depending on the date and term of the available ones.
The World Trade Organization (WTO) rules on non-tariff barriers to trade will apply. Pharmaceutical products - there are no customs duties, but the registrations will be valid only until the end of their current term, after which a new registration procedure will be introduced.
GMP inspection certificates are mutually recognized, but each party has the right to request an on-site inspection.
A specific niche is the export of food and beverages for refilling Bulgarian stores in the United Kingdom (UK). Exports vary considerably - between 40 and 70 million € per year. Characteristically, the variety of goods is large and the batches - small.
Although no duties are imposed, it is expected that their importation into the UK will become significantly more expensive, as each consignment will be customs cleared separately and will require a separate sanitary or phytosanitary certificate as required by the United Kingdom.
The exception is Northern Ireland, where EU-compliant goods can be delivered. The labeling of the goods must comply with the requirements of the UK.
What does Bulgaria (2019) import?
Similarly, there are no obstacles to the import of chemical products from the UK. Plastics - no tariffs and non-tariff barriers. Machinery, car electronics - no duties, but will probably need to issue new certificates of conformity.
Pharmaceutical products - no customs duties, but registrations will be valid only until the end of their current term. Alcoholic beverages will be imported duty free, but according to the rules for importing excise goods from third countries.
The case of toys should be investigated, as probably a significant part of them are of Asian origin and the rules of origin and cumulation of origin have changed significantly.
What is Bulgaria losing?
Bulgaria and the United Kingdom (UK) are the two geographical ends of the EU. The intensity of economic relations is not as high as in a number of other Member States (at this stage, Ireland, France and the Netherlands are considered to be most affected).
With the exception of some British pharmaceuticals, none of the imports are extremely important. Yet…
The voice of the "practical" Scandinavian countries and the Netherlands, to which Austria has joined, will weaken. In general, transparency in the work of European structures will decrease in favor of the southern countries.
The EU is losing a lot of the pragmatism of British research. A number of Bulgarian research centers work closely with those in the United Kingdom.
Such funds have also been established in Bulgaria. You can see some negatives of the form: Partially publicly funded funds incur costs to find and support innovative start-ups, and when one of the start-ups gains momentum, it is owned by an individual associated with the fund, not the fund itself. .
That is, the negatives are for a fund under PPP, and the positives (at least some of them) are privatized. There are transfers of private funds from the island to the mainland and their competition will speed up the treatment of children's diseases with public-private funds in the EU.
The listed three negative tendencies seem distant for Bulgaria, but in fact determine the macro framework of our development. There are other potentially negative factors, but these are the most significant in the long run, probably in that order.
General rules of the agreement
- Since the conclusion of the deal, the public has been flooded with information about agreements, procedures and general provisions. We will try to weed out what concerns most Bulgarian economic operators.
- Lack of tariff and quota restrictions.
- The rules for charging VAT are the same as for trade with third countries.
- The rules of origin of goods are changing. Goods and materials of EU origin imported into British production will be considered British when exported to the EU and vice versa. The United Kingdom has failed to negotiate that resources originating in countries such as China, Turkey and Japan be treated on an equal footing with those in the EU.
This provides a competitive advantage to Bulgarian goods such as electronics, electrical engineering, machinery, automotive parts and batteries. The United Kingdom has reached a six-year grace period for zero duties on electric vehicles, after which a 10% duty will be required if the content of third-country components exceeds 55%.
The EC has developed a tool for self-assessment of the origin of goods ROSA, which is recommended to use in the initial period after the entry into force of the agreement.
- An agreement has also been reached on resolving future disputes over trade rules and standards. For this purpose, a procedure for treatment of such cases has been agreed, and the establishment of a bilateral steering commission is expected.
- An agreement has been reached on the application of minimum environmental, social and labor standards, which does not provide for the automatic imposition of tariff sanctions in the event of non-compliance.
- The validity of the existing transport arrangements continues. The cabotage rights of the British carriers are limited, which may be a good opportunity for the Bulgarian transport companies to occupy this market niche.
- The services are not included in the scope of the agreement. The British economy is heavily dependent on services, as 80% of the country's GDP is generated by this sector. The United Kingdom became the first country in the world whose exports of services exceeded those of goods.
- After January 1, the registration of companies and opening bank accounts in the UK for Bulgarian entrepreneurs is significantly complicated.
- The United Kingdom retains its participation in the EU's Horizon and Copernicus programs, as well as its membership in Euroatom. A significant loss for Bulgarian education is the withdrawal of the United Kingdom from the Erasmus program, with the exception of the universities in Northern Ireland.
- The agreement also covers data transfer.
- The agreement will allow Bulgarian companies to continue to export to the United Kingdom, but the introduction of new export procedures will lead to some cost of the process. Some sectors, such as services and information technology, will remain attractive to British investors after Brexit.
Problems
- It is estimated that trade flows after 1.1.2021 are about 50% of normal. Although many European companies have refrained from operating for and from the United Kingdom, signals of problems have already emerged. The Air Force reports major delays - up to 48 hours, in ports due to the sharp increase in documentary work. The busiest section is Calais - Dover.
Truck drivers complain about the lack of any conditions for surviving the forced stay - toilets, water, food.
- It turns out that many traders outside Europe are not familiar with the new rules. Their goods have entered the United Kingdom, but do not have the necessary documents to continue for EU countries.
- Couriers such as DPD have stopped deliveries to and from the EU.
- Almost all shipments of goods requiring refrigerated trucks have been stopped.
- The transport of live animals, mainly pigs, has been stopped.
- Economic operators whose activities involve the transfer of sensitive data complain that a number of details have not been clarified and have been forced to suspend operations in order not to be infringed.
- The Marks & Spencer chain has stopped deliveries to its stores in Northern Ireland due to the so-called red tape - new rules for the movement of goods between Northern Ireland and the United Kingdom. The chain also reported problems with its supplies to the Czech Republic and France.
15.01.2021
Last day for applications under measure 60/40 from October to December
January 15 is the deadline by which employers will be able to submit applications for payment of funds under economic measure 60/40 for the period from October 1 to December 31, 2020.
The economic measure 60/40, through which employers can receive funds from the state to maintain the employment of their employees, was introduced after the state of emergency declared on March 13, 2020 due to the spread of the coronavirus. Its validity has been extended several times - until September 30, 2020, until December 31, 2020, until March 31, 2021.
Under the measure, employers from all economic sectors are entitled to compensation for maintaining employment, with the exception of: agriculture, forestry and fisheries, financial and insurance activities, public administration, education, human health and social work, activities of households as employers, undifferentiated activities of households for the production of goods and services for own consumption, activities of exterritorial organizations and services.
Funds are paid to employees who during the period from March 13 to December 31, 2020 have worked part-time, have used leave under Art. 173a of the Labor Code or their work has been suspended due to temporary restrictions on activity.
15.01.2021
Last day for applications under measure 60/40 from October to December
January 15 is the deadline by which employers will be able to submit applications for payment of funds under economic measure 60/40 for the period from October 1 to December 31, 2020.
The economic measure 60/40, through which employers can receive funds from the state to maintain the employment of their employees, was introduced after the state of emergency declared on March 13, 2020 due to the spread of the coronavirus. Its validity has been extended several times - until September 30, 2020, until December 31, 2020, until March 31, 2021.
Under the measure, employers from all economic sectors are entitled to compensation for maintaining employment, with the exception of: agriculture, forestry and fisheries, financial and insurance activities, public administration, education, human health and social work, activities of households as employers, undifferentiated activities of households for the production of goods and services for own consumption, activities of exterritorial organizations and services.
Funds are paid to employees who during the period from March 13 to December 31, 2020 have worked part-time, have used leave under Art. 173a of the Labor Code or their work has been suspended due to temporary restrictions on activity.
15.01.2021
An important change for traders and non-profit organizations
The Registry Agency reminds that according to the changes made in the Accounting Act at the end of 2019, a declaration of inactivity is submitted once, not annually.
Upon resumption of the activity, an annual financial report shall be prepared and submitted.
Pursuant to the adopted amendments, exempted from the obligation to submit annually a declaration of absence of activity within the meaning of item 30 of the Additional Provisions of the Accounting Act are the enterprises that did not operate in 2019 or each subsequent financial year and have declared this circumstance in the commercial register and the register of non-profit legal entities with a sample declaration by 30.06.2020.
Traders / non-profit organizations that did not operate in 2020 may submit a declaration under Art. 38, para. 9, item 2 of the Accounting Act according to an approved model until June 30, 2021 in the territorial office of the Registry Agency or electronically, through the unified portal https://portal.registryagency.bg/.
