Occupational Pension Schemes
Επαγγελματικά Συνταξιοδοτικά Σχέδια
Coverage
Mandatory or voluntary insurance
- Economically active population.
- Participation is often based on collective or individual agreements.
- Occupational pension schemes may provide for compulsory or voluntary participation (since 2020).
Financing
General finances
- Fully funded personal pension plans based on contribution payments.
Contribution rates
- Contribution payments are usually split between the employer and the employee (proportions vary).
- The constituent instruments of every occupational pension scheme must include information on the contributions of its members.
State support & incentivising strategies
- Contributions to mandatory schemes are tax-deductible.
- Contributions to voluntary schemes: only pension plans certified by the Tax Commissioner are subject to tax reliefs.
Administration
- The management committee of each ‘Institution of Occupational Pension Benefits’ (IOPB) administers the respective fund.
- The ‘Registrar of IOPBs’ regulates licenses, supervises and sanctions the IOPBs.
Qualifying Conditions
- Depends on each occupational pension plan.
- The constituent instruments of each occupational pension scheme must include the pensionable age.
Benefits
- Pension benefits may take the form of lifelong payments, temporary payments, lump sum payments or any combination of these methods.
- Benefits and amount are calculated on the basis of predetermined factors, such as earnings and contribution period.
Taxation and social security contributions
- Benefits are subject to taxation, in accordance with the Income Tax Law (Law 118(I)/2002) if total annual pension amount exceeds EUR 19,500.
- Contributions to public health insurance are mandatory (2.65% of pension benefit for the Cypriot General Health System).
Coverage
Financing
Administration
Qualifying Conditions
Benefits
Mandatory or voluntary insurance
- Economically active population.
- Participation is often based on collective or individual agreements.
- Occupational pension schemes may provide for compulsory or voluntary participation (since 2020).
General finances
- Fully funded personal pension plans based on contribution payments.
Contribution rates
- Contribution payments are usually split between the employer and the employee (proportions vary).
- The constituent instruments of every occupational pension scheme must include information on the contributions of its members.
State support & incentivising strategies
- Contributions to mandatory schemes are tax-deductible.
- Contributions to voluntary schemes: only pension plans certified by the Tax Commissioner are subject to tax reliefs.
- The management committee of each ‘Institution of Occupational Pension Benefits’ (IOPB) administers the respective fund.
- The ‘Registrar of IOPBs’ regulates licenses, supervises and sanctions the IOPBs.
- Depends on each occupational pension plan.
- The constituent instruments of each occupational pension scheme must include the pensionable age.
- Pension benefits may take the form of lifelong payments, temporary payments, lump sum payments or any combination of these methods.
- Benefits and amount are calculated on the basis of predetermined factors, such as earnings and contribution period.
Taxation and social security contributions
- Benefits are subject to taxation, in accordance with the Income Tax Law (Law 118(I)/2002) if total annual pension amount exceeds EUR 19,500.
- Contributions to public health insurance are mandatory (2.65% of pension benefit for the Cypriot General Health System).
Legal Basis: Law on the Establishment, Activities and Supervision of Institutions for Occupational Pension Benefits of 2020 (Law 10(I)/2020) (Ο περί της Ίδρυσης, των Δραστηριοτήτων και της Εποπτείας των Ιδρυμάτων Επαγγελματικών Συνταξιοδοτικών Παροχών Νόμος του 2020 (N. 10(I)/2020)).