Commentary on Judgment No. 22901 of 2024: Contribution Obligation for Self-Employed Workers

The recent order No. 22901 of August 19, 2024, from the Court of Cassation sheds new light on a crucial issue for self-employed workers: the contribution obligation and the correct interpretation of income to be included in the taxable base. In particular, the judgment analyzes the fundamental distinction between business income and capital income, clarifying which of them should be considered for the calculation of social security contributions.

The Regulatory Framework

According to the judgment, self-employed workers registered with the social security management must include in their taxable base all income derived from their entrepreneurial activity, as established by art. 55 of Presidential Decree No. 917 of 1986. This regulatory provision emphasizes that business income is that generated from the conduct of an entrepreneurial activity, excluding, however, capital income.

Self-employed worker - Contribution obligation - Business income - Notion - Income derived from participation in capital companies - Calculation - Exclusion - Basis. A self-employed worker, registered with the social security management due to engaging in work activity for which the requirements for mandatory social security protection arise, must include in the taxable base for calculating contributions the entirety of business income as defined by tax regulations, i.e., that which derives from the conduct of entrepreneurial activity (art. 55 of Presidential Decree No. 917 of 1986), with capital income, such as that derived from mere participation in capital companies without the provision of work activity (art. 44, letter e, of Presidential Decree No. 917 of 1986), being excluded.

Fundamental Distinction: Business Income vs. Capital Income

The Court reiterated a fundamental distinction: business income must be calculated based on what was effectively earned through the work activity. Conversely, capital income, such as that derived from mere participation in capital companies, must not be included in the taxable base for the calculation of social security contributions.

• Business income: earnings derived from active entrepreneurial activities.
• Capital income: proceeds derived from investments without work activity.
• Obligation to calculate contributions only on business income.

This distinction is not merely theoretical but has significant practical implications. Self-employed workers must be aware of which income to declare to avoid penalties or issues with the social security institution.

Conclusions

Judgment No. 22901 of 2024 represents an important reference point for self-employed workers and legal professionals. It clearly clarifies which types of income should be considered for contribution purposes, promoting greater transparency and awareness among professionals. It is essential for self-employed workers to be informed and to comply with these guidelines to ensure their social security protection and avoid future disputes.