Annual regularisation: why you may owe or get back contributions

Key rules

• Provisional bases: Your monthly contributions are based on expected income, so the final amount is only settled after the year ends.
• Refund: If you overpaid, the refund is paid automatically without a request from you.
• Extra payment: If you underpaid, pay by the end of the month after the notification.
• Surcharge: A late regularisation payment carries a 20% surcharge, or a lower rate in some cases.

The short version

What you pay during the year is a estimate. After the year ends, Social Security checks it against your real income. If you paid too much, you get money back. If you paid too little, you pay the difference.

How the comparison works

When you register, you declare the income you expect. Your monthly contributions are based on that guess, so they are provisional.

After the year closes, the tax agency sends your net income data to Social Security. Social Security then compares it with the bases you paid. Your real income decides which bracket you should have been in.

• Base too high: you overpaid, and the difference is refunded.
• Base too low: you underpaid, and you owe the difference.

You do not file anything for this. The comparison is done for you, using the data already held by the tax agency.

When it happens

The check runs after the tax agency data arrives. That is usually in the year after the contributions, often between spring and autumn.

• Refunds are paid automatically, usually within a few months. You do not need to ask.
• Extra payments come with a notification from Social Security. You must pay by the end of the month after the notification.

Exact dates depend on when your notification arrives, so watch your post and your online Social Security inbox.

If you do not pay on time

An unpaid amount gets the usual late-payment surcharge on Social Security debts: 20% of the debt. A lower rate can apply in some cases when you pay soon after the deadline. Ask Social Security whether it applies to you.

How to avoid a shock

Keep your income and expense records for the full year. Compare your real net income with the bases you chose. If your income is running well above or below what you declared, you can expect a bill or a refund. Set money aside if you think you underpaid.

The timeline, checklist and questions below cover the steps and deadlines.

Timeline and deadlines

• Year ends and the tax agency sends your income data to Social Security: after the year of contributions ends

• Refund is paid automatically if you paid too much: within a few months of the regularisation

• Social Security notifies you of an extra payment if you paid too little: when the regularisation is done

• A 20% surcharge applies to the unpaid amount, or a lower rate in some cases: if you miss the payment period

Checklist

• Keep your income and expense records for the full year so you can compare them with the tax agency data.

• Compare the bases you paid with your real net income to see whether you paid too much or too little.

• Watch your mail and your online Social Security inbox for the regularisation notification.

Contribution surprises that catch new self-employed workers

• The reduced quota ends and the full quota starts: Once the reduced starting quota ends, you pay the full quota for the contribution base you chose in the bracket for your expected net income. Your bracket does not change by itself: you keep the same base until you change it. Before the reduced quota ends, check that your base still matches your real income, and change it if not. The rules for changing it are set out in Estimating your income and choosing your contribution bracket.

• Brackets and rates get updated: The bracket table and contribution rates are revised every year, with the aim of bringing bases closer to real income. A bracket or rate that applied last year may not apply this year. Each year, look up the current bracket table and compare it with your expected income.

• A regularisation bill can arrive: After the tax agency sends your income data, Social Security compares it with what you paid. This usually happens in the year after the contributions, often between spring and autumn. If you paid too little, you get a bill that must be paid by the end of the month after the notification. Keep some money aside in case of a bill, and open your notifications as soon as they arrive. If you paid too much, the refund is made automatically within a few months.

• A missed or returned debit adds a surcharge: If a monthly debit is not paid or is returned, a 20 percent recargo (surcharge) applies when you pay after the deadline, and collection by enforcement can start. A lower 10 percent can apply if you pay by the end of the following month. Keep enough money in your account before the end of each month. If a debit is returned, pay the quota straight away.

Frequently asked questions

When will I get a refund if I paid too much?

Refunds are made automatically, usually within a few months of the regularisation. You do not need to apply. The regularisation itself usually runs from spring to autumn of the year after the contributions.

How long do I have to pay an extra amount after the notification?

You must pay the extra amount by the end of the month after the notification arrives. For example, a notification received in May means paying by the end of June. Social Security sends the notice, so watch your mail and your online inbox.

What happens if I do not pay a regularisation amount on time?

The usual late-payment surcharge for Social Security debts applies, which is 20% of the debt. A lower rate can apply in some cases if you pay soon after the deadline. Pay as early as you can after the notice.