Social Insurance

The participation to the social insurance scheme is mandatory for all gainfully occupied population in Cyprus either as employed or self-employed; employers are liable to contribute 6,3%, employees an additional 6,3% and the Government 4%, summing up to a total contribution of 16,6%. In the case of self-employed persons, 11,6% is contributed by the self-employed and 4% by the Government, summing up to a total contribution of 15,6%. Persons working abroad in the service of Cypriot employers and persons who interrupt their compulsory insurance, are allowed to be insured voluntarily. The rate of contribution for the voluntary contributors is 13,5% out of which 10% is payable by the voluntary contributor and 3,5% by the Government.

The social insurance scheme provides for several benefits, such as maternity allowance, sickness benefit, unemployment benefit, old-age pension, invalidity pension, widows' pension, orphans benefit, benefits for employment accidents and occupational diseases. As of 1st of May 2004, date of accession of the Republic of Cyprus in the European Union, the Social Insurance Services are implementing the E.C. Regulations 1408/71 and 574/72 which coordinates the social insurance schemes of the European Union member states. Cyprus has also concluded Bilateral Agreements on Social Security with the United Kingdom, Greece, Egypt, Canada, Quebec, Australia, Austria, the Slovak Republic, Switzerland, the Czech Republic, the Netherlands and Bulgaria.

In addition to the payment of the Social Insurance contributions, employers are also obliged to contribute 1,2% to the Redundancy Fund, 0,5% to the Human Resources Development Fund and 2% to the Social Cohesion Fund.

For more information please visit www.mlsi.gov.cy/mlsi/sid/sid.nsf