Pensions repayments on leaving to EU

dannyt986 · #1 29.01.2008, 11:12

I had a search but didnt see this specific point discussed.

Since 1.7.07 under the bilateral agreements it has no longer been possible to withdraw the whole amount of pensions savings if you are moving back to an EU country, and as discussed elsewhere, since Swiss pensions law forbids (for now) transfers outside Switzerland, that means your money has to sit here. That is unless you access it for one of the permitted early uses eg house purchase.

HOWEVER, the legislation say this applies just to the compulsory (obligatorisch) part of the savings. This is the contributions on upto about 90kchf of salary. Does this mean that, if say you have 200kchf salary, about 50% of the contributions, plus any top ups, can still be accessed as cash?

Regards,
Daniel

muze7 · #2 29.01.2008, 11:47

Pension issue 1 June 2007, collegue leaving

	Quote:
	What the HR department did was the calculations of the compulsory part of the pension fund according to the law, and then the variance to what I'd actually been deducted. The compulsory part needs (now) to stay in switzerland, in a "Vested benefits account" at a bank, and the rest is returned to my normal bank account. I'll try to find the link to the official leaflet they gave me, it's quite helpful. Oh, right, the 1st pillar, nope, it needs to stay here as well, and your colleague can't forget to let everybody know of their new address (and any subsequent changes), so that when they reach retirement age, the swiss government can send them their pension

	Quote:
	The law actually states (and by the way there are versions in every EU language - dont ask me where but there are as it is bilateral ie EU and Switzerland) that the obligatory savings part of your pension will be paid into the state pension scheme where such a scheme exists or can be placed in a locked vested interest account in Switzerland until you reach retirement age or wait 5 years. Now lets take the examples of France, Italy or Germany. Pay the 10 years obligatory pension money lets say 100K into the state scheme and you have just said "hasta la vista baby" to a fat wad I cannot remember the exact level but the obligatory part is the pension savings on the first ca 84800 of your salary. Over this amount is over obligatory and you can cash in. Hence my guess of 100K after ten years 84.8(15-3)%10. 84.8 because I seem to recall it is 80% of 106K - the unemployement figure, 15 because it is normalish to have a 10 +5 pension scheme and the 3% is your life insurance part of it.

the above post is by Richard see Taking money out of Switzerland

	Quote:
	I've worked in Switzerland for 7 years and accumulated a company pension fund (2nd pillar) and volutary 3rd pillar. This year I proceeded to take both 2nd & 3rd pillar money out of Switzerland, however I was charged a withholding tax on exiting the "system". The trick is that the WHT tax rate is different in different cantons. So I transferred both my 2nd pillar and 3rd pillar to a pension fund foundation in Schwyz, where the WHT tax rate is around 5%, versus the 6% in the original fund. The fund is called www.PensFree.ch (excellent service btw). Once my money was in PensFree, I then transferred it out of Switzerland - it cost me 5% + 0.6% fee. The exercise was beneficial as all the contributions I made in the past was tax free (saving me at least marginal 30%) and I was only charged 5.6%.

Polorise · #3 29.01.2008, 11:50

	Quote:	muze7
	Pension issue 1 June 2007, collegue leaving

Thanks Muze, however, does this count for all EU countries; i.e. include the new/recent entrants such as Slovenia, Slovakia & Baltic States ?

dannyt986 · #4 29.01.2008, 11:57

Yes, thanks! Obviously my search (I did one honest was a bit cursory). Daniel

muze7 · #5 29.01.2008, 12:01

	Quote:
	Thanks Muze, however, does this count for all EU countries; i.e. include the new/recent entrants such as Slovenia, Slovakia & Baltic States ?

	Quote:
	Welche Staaten gehören zur EU? A) EU-15-Staaten

	Quote:
	Belgien, Dänemark, Deutschland, Finn- land, Frankreich, Griechenland, Gross- britannien, Irland, Italien, Luxemburg, die Niederlande, Österreich, Portugal, Schweden, Spanien B) EU-Staaten nach EU Erweiterung Estland, Lettland, Littauen, Malta, Polen, Slowenien, Slowakei, Tschechische Republik, Ungarn, Zypern. C) Neue EU-Staaten 1. Januar 2007 Bulgarien und Rumänien gehören seit dem 1. Januar 2007 der EU an. Das Abkommen über die Personenfreizügigkeit ist für diese beiden Staaten jedoch nicht anwendbar. Sie sind als Drittstaaten zu betrachten, solange die Unterzeichnerstaaten des Abkommens nicht anders entschieden haben.

Quote:

Auswirkungen

	Quote:
	Die Erfordernisse der Gleichbehandlung aller versicherten Personen – unabhängig von deren Nationalität – und der Garantie der Auszahlung sind bereits heute erfüllt.Diese Richtlinie hat in der Praxis keine Än-derung bei der überobligatorische Vorsorge zur Folge. Eine Barauszahlung des Überobligatoriums ist weiterhin zulässig.

From http://www.helvetia.ch/infoblatt_bilaterale0107_dt.pdf

So if you are asking if a person from Slovakia can still take the überobligatorische Vorsorge, I think the above means yes. But check to make sure

Richard · #6 29.01.2008, 12:29

	Quote:	dannyt986
	I had a search but didnt see this specific point discussed. Since 1.7.07 under the bilateral agreements it has no longer been possible to withdraw the whole amount of pensions savings if you are moving back to an EU country, and as discussed elsewhere, since Swiss pensions law forbids (for now) transfers outside Switzerland, that means your money has to sit here. That is unless you access it for one of the permitted early uses eg house purchase. HOWEVER, the legislation say this applies just to the compulsory (obligatorisch) part of the savings. This is the contributions on upto about 90kchf of salary. Does this mean that, if say you have 200kchf salary, about 50% of the contributions, plus any top ups, can still be accessed as cash? Regards, Daniel

Cor blimey that is complicated to follow, although good work Muze on finding those old posts - did I really write that?!

Obligatory part of the pension scheme is that between
79560 and 23205 - ie 56355-
Over obligatory part is 79561 until unlimited.
The over obligatory part is irrelevant you can cash it in so yes you have access to probably a lot more than 50% of your pension fund.
The obligatory part however must stay in Switzerland unless you leave to a country that is within the EU but does not have a compulsory state pension scheme or move out of the EU. Those are the rules. You cannot take the pension money with you ie transfer it otherwise. If there is a state pension scheme then the money stays here frozen earning a massive 1.5% interest per year - but only the obligatory part.

When I wrote the quoted post above this was at a time when the Swiss law and a lot of Europe for that matter was still in draft version. So it has been tweaked and to be honest I should really update the posts but I don't have the time to do that and answer your question

Alternatives potentially are also to buy a house in an EU country. Under a quirk of Swiss law this would be grounds to have the obligatory part of the pension fund cashed in as well. I am not sure though if this has been tested.

Furthermore, I would be interested to know if anyone has tried to take the obligatory part of the pension to the UK as the UK does not have a compulsory state scheme so theoretically you should be able to take the money... I know not if this has been tested though...

Any questions please pose them as the law has now been finalized on this so the previous threads might not be accurate...

muze7 · #7 29.01.2008, 12:44

Richard, you once mentioned that if someone only paid above the obligatory part for a short while, you cannot take the difference with you, because you need to fill in the 'obligatory pot' first. Problem is I cannot find this post.

So, how many years do you usually need to fill in this obligatory pot of BVG to the max? Because if it is a long time, your extra payments will not reach the 'uberobligatorisch' level and they will be frozen too.

	Quote:
	Alternatives potentially are also to buy a house in an EU country. Under a quirk of Swiss law this would be grounds to have the obligatory part of the pension fund cashed in as well. I am not sure though if this has been tested.

Someone on the forum thought if you buy it as you leave CH, it will work, but that you cannot wait until 6 months after you have left. Someone somewhere must have done this already! It would be good to know the details.

dannyt986 · #8 29.01.2008, 13:18

	Quote:	muze7
	Richard, you once mentioned that if someone only paid above the obligatory part for a short while, you cannot take the difference with you, because you need to fill in the 'obligatory pot' first. Problem is I cannot find this post.

You/he must be thinking that the "age 25 to whenever you started you swiss pension" part of the obligatory pot must be filled.

Richard, as ever thanks for your information.

I think the issue with transfers out of a Swiss scheme to a UK one is that i) it is permitted under the bilateral laws, but ii) the BVG law forbids transfers out of Swizerland or Lichenstein for now.

The legislation is extremely explicit on the fact you can access the cash to but property in your new country of residence. However, I did not hear of a test. If I remember correctly, the document you use to access the second pillar is a "self certification" jobby anyway.

Daniel

dannyt986 · #9 29.01.2008, 13:26

I will ask my HR dept for a certificate.... I have a good mix of compulsory and over-compulsory contributions and last year topped up my pension with 100% of the contributions I was allowed to make, so it should test pretty much test the situation.

Watch this space.

Daniel