10th August 2018
With a landscape that’s perfect for outdoor pursuits, is no wonder that Slovakia is a top destination for anyone interested in exploring, hiking, skiing or mountain biking. Its location in central Europe also makes it a perfect springboard for travellers wishing to explore the rest of the continent.
Talent shortages create contracting opportunities
Slovakia is also a fantastic place for international contractors. The country’s Finance Ministry and central bank have forecast that economic growth will accelerate to over four percent next year, fuelled largely by its booming car sector. In line with this positivity, businesses across many sectors are seeking to bolster their workforces, but demand outstrips supply: in fact, 54% of employers in Slovakia report difficulties in hiring the right people for their business. These intensifying labour shortages are good news for contingent workers, however, as they are boosting pay rates as well as increasing employment opportunities. Although a number of industries are talent-short, there is particular demand for skilled professionals in the banking, engineering and electronics sectors.
The legal bit
Clearly, Slovakia is a great place to seek a new opportunity but there a few things that you need to know about contracting there. Only non-EU nationals need a work permit to undertake employment in the destination. EU nationals don’t need a residence permit but must register with the local authorities once they are established in the country. Before beginning work as a contractor, you’ll need to get a Trade Licence. To obtain this, you’ll need a Non-criminal Record Certificate, which must be less than three months old, and a Slovakian rental address.
Another thing to know is that your aggregate income will be subject to tax which is deducted at progressive rates. If you earn up to EUR 35,022.31, you’ll be taxed at a rate of 19%. Above this, the rate is 25%. In your first year of contracting, you’ll pay tax through an end-of-year tax return. After a year, you’ll need to make either quarterly or monthly advance payments, depending on your previous tax liability. You’ll also be subject to social security deductions.
Contractors should also be aware that they are entitled to a lump sum of 40% for business expenses, but claims must be receipted.
Finally, once your contract ends, a letter to the tax authorities is necessary to deregister you.
Of course, the best way to ensure that you are compliant with local legislation is to partner with a specialist international contractor management company. Contact the team today to find out how we can help you.