Currently the most frequent contracts in the field of medical services and private health insurance are the following:

MEDICAL SERVICES

The insurance of the work medicine services – on the basis of a services providing contract with a provider of medical services (ex. Regina Maria, MedLife, etc.) in order to determine the work capacity of the employees and to monitor the health of the employees.

Fiscal treatment: This expense is entirely deductible for the company. The work medicine services do not represent advantages in kind, and in consequence the company does not owe income tax and social contributions (employee and employer) for these amounts. We mention that ensuring the work medicine services for the employees represents a legal obligation for each employer in Romania.

The insurance of the medical services provided under subscription plans through the conclusion of a services providing contract with a provider of medical services (as an example: Regina Maria, MedLife, etc.)

According to current law, the medical services provided under a subscription plan represent prepaid medical services (by the employers), offered directly by the providers to the subscribers, and not through the insurers (through the package of basic medical services of the system of social insurance system). These services are provided on the basis of a contract concluded directly between the employer and a provider of medical services.

Fiscal treatment: The monthly value of the subscription according to the above-mentioned contract represents an in-kind advantage for the employee, for the amounts that surpass the value of the work medicine services, and thus income tax and social contributions are due (employee and employer).

For the employer, the payments due to the services of work medicine are considered as deductible expenses. The payments made on behalf of the employees for subscription based medical services are entirely deductible for the employer if they are assimilated to salary advantages and subject to taxation as salary components.

HEALTH INSURANCE

The conclusion of optional health insurances – through authorized insurers

The optional health insurances represent a voluntary system through which an insurer (insurance company) creates, on the mutuality principle, an insurance fund through the contribution of a number of insured persons who are exposed to the risk of disease, and pays the allowances according to the stipulations of the insurance contract to those that encounter a prejudice.

The optional health insurance must be limited to medical services which surpass the basic medical services package covered by the health social insurance system (for example work medicine). The insured persons may receive allowances for that part of the expenses with the medical services that surpasses the basic medical services package.

Fiscal treatment: The amount due to the optional health insurance paid by the employer is not taxable for the employee (as income tax) and social contributions are not owed (for employee and employer) if they are contained in the limit of 400 euro / year / employee. The amounts surpassing 400 euro / year /employee represent advantage in-kind granted to the employees, and for these amounts are owed social contributions (employee and employer), as well as income tax.

For the employer, the optional health insurance paid on behalf of the employees and which are not subject to the income tax (those in amount of 400 euro/year/employee) are considered as deductible expenses. The amounts paid on behalf of the employees above the not taxable individual limit are entirely deductible for the employer if they are assimilated to the salary advantages and they are subject to taxation as salary components.