Reporting & Payment for Businesses without Employees
Depending on whether or not you have employees, Social Security & Healthcare Fund contributions are reported and paid differently. In this section, we will consider how business without employees should report and pay their quarterly contributions.
If your business has employees, you can read how Businesses with Employees report and pay their quarterly contributions.
Calculating the Owner’s Gross Wage
When reporting their Quarterly Contributions to the SSA, owners of businesses without employees are required to submit copies of all GRT Reports that were filed to the Division of Revenue & Taxation. The gross revenue earned during that quarter is important because this amount becomes the basis for calculating the owner’s reported gross income or wages.
The owner gross income per quarter is calculated as 25% of the business's reported total gross revenue in a year, whether or not the owner actually received that income. If the gross revenue reported to Division of Revenue & Taxation was $24,000 for the quarter, your gross income or wage is $6,000 ($24,000 x 25%).
Owners of businesses that do not have employees are considered both employer and employee at the same time. Therefore, they are required to contribute 12% of taxable income (wages not exceeding $5,000) for Social Security and 5% of total gross wages for the Healthcare Fund.
If you own multiple businesses that do not have employees, then the owner share should be filed and paid under the company with the highest reported gross revenue. If you make more than $10,000 in gross annual revenues, you are required to pay this owner share. Businesses that make less than $10,000 in gross annual revenues have an option to pay.
Reporting and Payment Deadlines
The payment of SS & HCF contributions differ between businesses making more than $10,000 in annual gross revenues and businesses making less than $10,000 in annual gross revenues. Click on any of the following two topics to learn more.
Businesses Making MORE than $10,000 in Annual Gross Revenues
Businesses without employees and are making more than $10,000 in gross annual revenues are required to report and pay Social Security and Healthcare Fund contributions at the end of each calendar year, ending December 31. Therefore, reports and payments for a business that is making more than $10,000 a year is due on or before January 31.
Effects on your Eligibility for National Health Insurance
Choosing to pay contributions at the end of the year will affect your eligibility for HCF benefits during the current year. Since your contributions come in at the end of the year, you will not be eligible for National Health Insurance during the current year. Also, if you choose to pay for all 4 quarters at the end of the year, you will only get two quarters of NHI coverage, since the coverage period for 1st and 2nd Quarter has passed.
The tables below display NHI payment options that are open to businesses without employees:
Medical Savings Accounts
If you opt not to pay HCF contributions on a quarterly basis, you will not have any contributions that go into your individual MSA. If they would like to have an MSA, you may voluntarily deposit into your Medical Savings Account (minimum of $10.00 per deposit).
Businesses Making LESS than $10,000 in Annual Gross RevenuesOpen or Close
Businesses without employees and are making less than $10,000 in gross annual revenues have the option to file Social Security and Healthcare Fund contributions on a quarterly basis.
They may file at the end of each calendar year, ending December 31. Payment of contributions is optional.
If you decide not to pay contributions, you will not be entitled to SS or HCF benefits. However, you may voluntarily participate in the HCF by voluntarily purchasing National Health Insurance. If your reported gross revenue for the quarter is $1,300 or less , then you may voluntarily purchase NHI for $29.25 a quarter. If your reported gross revenue for the quarter is more than $1,300, then you must pay 2.25% of your gross revenue for that quarter to voluntarily purchase NHI.
You may also voluntarily depositing into your Medical Savings Account (minimum of $10.00 per deposit).
How to Fill your Quarterly Report Form
Below is a sample of how a business without employees should report and pay SS & HCF Contributions with the Quarterly Report Form.
|Total Gross Revenue|
|The total gross revenue must match the gross revenue that is reported to Division of Tax & Revenue. This amount is important for businesses without employees because this amount becomes the basis for calculating the owner's reported gross wages.|
|The owner share for a business without employees is presumed to be $25% of the business's reported total gross revenue. In this case, the gross wages would be $6,000 (or 25% of $24,000)|
|SS Taxable Wages|
|The maximum taxable wage subject to SS tax is currently $5,000 per quarter. This will be the basis for how much SS tax must be paid. There is no maximum on how much gross wages is subject to HCF tax.|
|Calculate 12% of the amount found in column 4 which is the "wages subject to SS Tax". Remember that $5,000 is the maximum taxable SS wage.|
|HCF tax is 5% of gross wages, with no maximum ceiling. In this case, HCF tax is $300 or 5% of $6,000.|