Your pension scheme may have the following provisions:
- A lifelong old-age pension for the employee
- Options for early retirement. The lifelong pension is based on the principle that the employee retires on reaching age 68. With a private pension, you can choose to take some or all of the fund early for a smaller pension. Since 1 January 2017, a recalculation is not required if the pension starts on the first day of the month in which the employee becomes 68. If someone only stops working partially, then the pension can only be advanced partially unless the claim is within the 5 years before reaching state pension age.
- A partner pension that on the employee's death is paid to the employee's (former) spouse or (former) partner with whom the employee had a joint household. A partner pension can start on the first day of the month in which the employee has passed away.
- An orphan's pension that on the employee's death is paid to the employee's children or foster children below the age of 30. The orphan's pension can start on the first day of the month in which the employee has passed away.
- An occupational disability pension which is paid once the period of an employee's occupational disability exceeds a year.
- A survivors' bridging pension which can be paid alongside the partner pension or orphan’s pension until the partner reaches state pension age. The pension must be insured with an insurance company specified in the law.
- The pension must, on the basis of the retirement age, remain within statutory limits including:
- With an average salary pension scheme, the old-age pension is accrued at a rate of a maximum of 1.875% of the pensionable wage for each year's service and with a final salary pension scheme at a rate of a maximum 1.657%.
- A different accrual method is applicable to defined contribution pension schemes: the annual contribution to be paid is then determined, rather than the above annual accrual rate.
- All limits are determined inclusive of the state old-age pension (AOW) benefit and the pension may have modules from which the employee can select.
- An employee may accrue pension during parental, sabbatical, study or care leave, or leave based on a withdrawal from the employee's career-break savings balance.
- An employee may also convert the partner pension into a higher or earlier old-age pension, and vice versa.
- The effective date of the pension may be postponed until 5 years after reaching the state pensionable age. As of 1 January 2017, the employee is not required to have been in employment for this period of 5 years.
- Variable payments of pension benefits are permitted within the ratio of 100:75.
- The value of the pension benefits may also vary in relation to the value at the time of the effective date of the pension. This is due to the expected increase in life expectancy, the mortality results or the achieved investment results.
- From 1 January 2018, the pensionable salary may not exceed €105,075. This amount is reduced proportionately for employees who work part-time.
Recognized pension insurer
The following can act as a pension insurer:
- a pension fund
- an insurance company as referred to in Article 1:1 of the Financial Supervision Act
- The insurance company must recognize the pension commitments in the national business assets for corporate income tax purposes.
- a premium pension institution
- an organization which is not established in the Netherlands and meets one of the following conditions:
- The organization is recognised by the relevant Dutch ministers.
- The organization had already insured the pension during a period in which the employee or former employee had not lived or worked in the Netherlands and then continued this pension insurance with this same pension insurer.
The pensionable salary may not exceed €105,075 as of 1 January 2018. But an employee can accrue net pension for his or her income over and above this. The net pension must be saved from the net salary in the form of an available contribution scheme.
Designation of a pension scheme
If you have a pension scheme that does not meet the conditions attached to pension schemes in full then the Minister of Finance and the Minister of Social Affairs and Employment may still, subject to certain conditions, designate the scheme as a pension scheme. You can submit an application for the designation of a scheme as a pension scheme to:
- Ministry of Finance
- PO Box 20201
- 2500 EE The Hague
- The Netherlands
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