The SSS Coverage of an I-Café Business

Social security insurance for all its good intent and purpose is one item that should not face any objection as a mandatory requirement in the operation of a business for as long as the premium is affordable and the benefits are attainable. In the Philippines, social security insurance is being provided by either the Social Security System (SSS) or Government Service Insurance System (GSIS). The former covers the private sectors while the latter is for government employees and their dependents.

The i-café business for being a business activity of a private person must have its social security insurance covered by the Social Security System. The agency was founded by Republic Act No. 1161 also known as Social Security Law of 1954 which was amended by Republic Act No. 8282 otherwise known as Social Security Act of 1997. Both laws provide for the compulsory SSS coverage upon all employees not over sixty (60) years of age and their employers and that in the case of domestic helpers, their monthly income shall not be less than One Thousand (PhP1,000) Pesos a month.

The Social Security Act of 1997 paved the way for the voluntary SSS membership of full-time spouses and overseas contract workers. It likewise mandated the compulsory coverage of self-employed individuals including the likes of i-café owners who manages and operates his business by his own. The SSS Circular No. 33-P contains the schedule of contributions for all kinds of SSS members (employee, employer, voluntary, overseas worker and self-employed).

The current schedule of contributions effective since last January 1, 2007 specifies that the lowest salary credit that all kinds of members must pay for is Five Thousand (PhP5,000.00) Pesos per month or a minimum monthly contribution of Five Hundred Twenty (PhP520.00) Pesos per member. As an i-café owner, you must pay this minimum amount for yourself as self-employed SSS member and the same amount for every employee that you have.

I must mention that when you have people under your employ, you must pay the SSS contribution every month. You will be liable to pay some penalties when you failed to do so. As a self-employed SSS member (no employee), an i-café owner can choose to pay quarterly without penalty when you failed to pay.

For your questions regarding this blog topic, you may refer to the Social Security Act of 1997 which has link above or post them here. I am not an expert on the subject but I had long talks with some personnel of the agency before I wrote this article.