The contribution scheme of Article 37 offers the self-employed in their main occupation and their assisting spouses the opportunity to reduce their social security contributions through assimilation to a secondary occupation. But what exactly does this scheme entail, and is it beneficial for everyone? In this article, we explore the details of this scheme and examine whether it could be a smart choice for you.
What is Article 37?
Article 37, or the assimilation to a secondary occupation, is a social security regulation that can offer a considerable reduction in social security contributions to the self-employed in their main occupation. This is especially beneficial if their annual income remains below the limit of 8,832.73 euros in 2024.
Pros and cons
Pros: Lower social security contributions up to a certain income level.
Cons: No accrual of social rights, such as a pension, which can have adverse financial consequences in the long term.
Condition: minimum income
There is a catch: you must earn enough to qualify for the grant. In 2024, your annual income must be at least 16,861.46 euros. You can prove this with your paid social security contributions or your tax assessment notice. In addition, the VDAB (the public employment service of Flanders) must confirm that you actually need the support.
Conditions for Article 37
You are eligible for Article 37 if you meet the following conditions:
- You are married and your partner is accruing their own social rights.
- You are receiving a survivor’s pension or transitional allowance.
- You are a permanently appointed teacher with an employment level of 50% to less than 60%.
- You have a political mandate (e.g. member of parliament, mayor).
- You have a recognized disability with a reduced earning capacity.
In addition, your net taxable annual income may not exceed 8,832.73 EUR (or 1,865.45 EUR for politicians). These income limits are very strict. So it is very important to carefully monitor your profits as the end of the year approaches. Even exceeding the limit by 1 cent can result in the minimum levy for a self-employed person with a main occupation. It can therefore certainly be worth your while to fill up your tank or go out to a restaurant…
However, once you reach that same amount, you will start paying more in contributions than a self-employed person with a main occupation. Moreover, just like the self-employed in a secondary
occupation, you will not accrue any social rights with your social security contributions.
Social security contributions
Social security contributions are calculated as follows:
- Less than 1,865.45 EUR: No social security contributions.
- Between 1,865.45 EUR and 8,832.73 EUR: Reduced contributions.
- More than 8,832.73 EUR: Normal contributions as a self-employed person in main occupation.
You can apply for the assimilation to a secondary occupation with your social insurance fund, which will assess your situation and request additional documents if necessary.
Who is this scheme suitable for?
This scheme is intended for:
- Assisting spouses of the self-employed.
- Part-time teachers with a secondary occupation.
- Persons in a financially vulnerable position without sufficient pension accrual.
It is important to properly evaluate whether this scheme is beneficial for your situation.
Conclusion
Article 37 can be advantageous for the self-employed with a limited income, but the lack of social rights, such as pension accrual, can be disadvantageous in the long term. In some cases, such as for part-time teachers, it can be a suitable option, but it is often wise to pay full social security contributions and thus accrue your own rights.
