Social security contributions in detail
Every employer must affiliate its employees to the General Social Security System and make monthly contributions based on the employees’ monthly wage. Social Security System in Colombia covers pensions, health and labour risks.
Contributions are calculated as follows:
- health 12.5%: of which the employer pays 8.5% and the employee 4% (with employees earning less than ten monthly minimum legal wages being exempt from health contributions);
- pensions 16%: of which the employer pays 12% and the employee 4% (with employees earning more than four monthly minimum legal wages being required to make additional contributions to the pension system, ranging between 1% and 2% of the employee’s salary);
- labour risks: of which between 0.348% and 8.7% is paid by the employer (varying in accordance with the level of risk).
The general minimum earnings used to calculate contributions are one monthly minimum legal wage, and the cap is 25 monthly minimum legal wages. The date of payment of contributions varies according to the employer’s ID number.
Note that if variable pay (‘non-salary benefits’) exceeds 40% of the employee’s take-home pay, the excess must be added to the base salary when calculating social security payments.
Author: Brigard & Urrutia Abogados
Date: March 2019
Note: All currency conversions into EUR were made on 1 February 2019, using a mid-market rate.