Aruba EOR and payroll guide 2026: SVb social security, AZV health insurance and cessantia compliance

Employer and employee contributions in 2026

The Sociale Verzekeringsbank Aruba (SVb) runs the AOV (old age) and AWW (widows and orphans) pension schemes, and AZV (Algemene Ziektekosten Verzekering) is the general health insurance scheme covering residents. Contributions in 2026:

• AOV/AWW: 10.5% employer and 5.0% employee, on wages up to AWG 85,000 a year (AWG 7,083.33 a month). The maximum employer AOV/AWW cost is AWG 743.75 a month.
• AZV: 8.9% employer and 1.6% employee. The wage base and any ceiling for AZV are set separately; confirm with the authorities before payroll is configured, especially for salaries above AWG 7,083.33 a month.
• Cessantia levy: a flat annual employer contribution per employee funding dismissal payments. The amount is set by the authority; it is not part of the calculator's percentage model, so add it to the annual budget per head.

Sickness insurance (ZV) and accident insurance (OV) apply to employees under the statutory schemes and are administered by the SVb; premium rates are set by the SVb and should be confirmed for your workforce.

Wage tax and income tax treatment

Aruba employers withhold wage tax (loonbelasting) from employees and remit it to the Departamento di Impuesto (DIMP), the tax department. Wage tax is progressive with a basic allowance, and the bands and allowance are set by the tax department. Our calculator applies the 2026 bands on annual pay after employee SVb/AZV contributions and the AWG 30,000 tax-free threshold (10% on the first AWG 34,930, 21% to AWG 65,904, 42% to AWG 147,454, 52% above), so its net pay figure is after wage tax.

In Aruba, wage tax, AOV/AWW and AZV contributions have been collected through a combined monthly return in the past, which simplifies remittance; confirm the current collection arrangement with DIMP when you register.

• Specialist expat regime. Aruba has offered a reduced tax treatment for qualifying foreign specialists in some periods, with conditions on salary, expertise and approval. Confirm current availability before using it in an offer.
• Benefits in kind such as housing, cars and allowances are generally taxable wage.
• No separate employer payroll tax exists in the calculator model; employer cost is salary, SVb and AZV contributions, plus cessantia.

Worked example: AWG 5,000 a month resort revenue analyst

A resort group hires a revenue analyst in Oranjestad at AWG 5,000 a month (AWG 60,000 a year, about USD 2,793 a month at 1.79). Salary is under the AOV/AWW ceiling.

The second example shows why the AZV base matters: if AZV has its own ceiling, the AWG 801.00 line will be lower. Ask your payroll provider which base it applies and get it confirmed by the authority.

Termination, dismissal permits and work permits

Aruba labor law follows the Dutch civil law tradition. Employment is protected, and an employer that wants to end an indefinite contract generally needs a dismissal permit from the labor department (Directie Arbeid en Onderzoek) or a court dissolution, unless the dismissal falls in an exception such as probation, mutual agreement or summary dismissal for urgent cause.

• Cessantia payment. An employee dismissed for reasons not attributable to them is generally entitled to cessantia, a payment based on years of service and salary and funded in part by the employer levy. The formula and caps are set by law; confirm before budgeting an exit.
• Notice periods are set by the civil code and depend on length of service; the employer's period is generally longer than the employee's. Confirm the current schedule.
• Fixed-term chains can convert into indefinite employment after statutory limits.

Work permits. Foreign nationals, other than those exempt such as Dutch nationals in some cases, need a residence and work permit through DIMAS (the immigration department), with labor market testing to show no suitable local or resident candidate. Processing times and fees are set by DIMAS; confirm before fixing a start date. Hospitality employers recruiting seasonal staff should plan permit lead times into opening schedules. The Caribbean work permits guide explains why CSME free movement does not extend to the Dutch Caribbean.

Banking and FX realities

The Aruban florin (AWG) is pegged at 1.79 to the US dollar by the Central Bank of Aruba, and US dollars are widely accepted in tourism. A USD-funded employer faces no rate risk, but three costs still need checking:

• Conversion spread. An invoice converting at 1.745 instead of 1.79 keeps about 2.5% of payroll; on AWG 60,000 a year that is about USD 840 per employee.
• Foreign exchange commission. A commission has applied to foreign exchange transactions with residents; ask your bank for the current charge on payroll funding and on employees' outbound transfers.
• Account opening. Corporate accounts require full ownership documentation and can take several weeks. Some employers pay a small Aruba team from a regional bank that also serves Curaçao.

For payment file formats and bank cut-off times, see the commercial bank payroll guide. For multi-island hospitality payroll that includes Aruba, read the resort payroll playbook.

EOR vs own entity vs payroll bureau: cost benchmarks

Global EOR coverage in Aruba is limited and usually partner-based. For a resort or tourism operator with an Aruban entity already in place, a local payroll bureau is the usual choice; an EOR fits a first hire or a short project. Benchmarks for a five-person team:

Deposits of one to two months of gross pay are common on EOR contracts; at AWG 5,000 that is up to about USD 5,590 per head. Audit a quote in the EOR fee audit and test your own entity in the breakeven calculator. Read the Deel, Multiplier and Papaya Global reviews, and compare Deel vs regional Caribbean EOR and EOR vs PEO vs payroll bureau. Model your own salary in the Aruba employer cost calculator.