Statutory Pension Scheme for Self-Employed Persons

Mandatory insurance

• Self-employed persons with a trading license (commercial self-employed persons). 
• Other self-employed persons including liberal professionals (if their chamber has not declared their opting out).
• Former self-employed persons during military service (or alternative service).
• Former self-employed persons during child-raising periods.

Opting out

• Specific groups of liberal professionals; request had to be filed by the professional chamber by 1 October 1999 at the latest; only the bar associations have made use of this possibility.¹
• Commercial businesses with only marginal income and limited turnover under certain further conditions (e.g. persons that have only started self-employed activity or during child-raising periods).

Exempted

• Notaries. 
• Liberal professionals with only marginal income. 
• Commercial businesses during periods of suspension of their trade license (or similar cases).

Voluntary insurance

• Persons with at least twelve months of mandatory insurance within the previous 24 months or at least three months of mandatory insurance (per year) in the previous five years can continue insurance on a voluntary basis (until they are mandatorily insured again or entitled to a pension).
• Possibility of retroactive insurance for periods of education.

General finances

• Mainly PAYG-financed from insurance contributions.
• Partly tax-financed out of the general federal budget.
• In addition, artists are subsidised by a social security fund set up for their benefit.

Contribution rates to mandatory insurance

• Fixed share of annual earnings (22.8%); with contribution assessment ceiling (Höchstbeitragsgrundlage).
• For certain liberal professionals: only 18.5%/20.0% must be paid by the insured person; the difference to 22.8% is made up by a ‘partner benefit’ from the federal government from tax revenues.
• Fixed minimum contribution basis (not applicable if person is employed aside from self-employed activity).
• Insured persons can voluntarily choose to pay higher contributions.

Contribution rates to voluntary insurance

• Fixed contribution rate (22.8%; 20.0% for certain liberal professions).
• Fixed contribution base depending on former earnings.
• Insured persons can voluntarily choose to pay higher contributions.

Taxation of contribution payments

• Contributions are tax-deductible.

• The ‘Social Insurance Institution of the Self-Employed’ as a self-administered federal pension carrier takes administrative responsibility for all affairs related to self-employed persons.

Qualifying conditions

• Same as for statutory pension scheme for employees and equally treated persons.

Early retirement

• Same as for statutory pension scheme for employees and equally treated persons.

Deferred retirement

• Same as for statutory pension scheme for employees and equally treated persons.

Combining employment & retirement

• Same as for statutory pension scheme for employees and equally treated persons.

Pension benefits 

• Same as for statutory pension scheme for employees and equally treated persons.

Benefit calculation

• Based on the multiplication of the following factors: 
• Assessment basis: insured income (contribution basis) of each calendar year (transitional provisions for insurance periods before 2005 and in particular for persons born before 1955).
• Account percentage: same as for statutory pension scheme for employees and equally treated persons.
• For insurance periods before 2005 an initial credit (calculated according to the former law) on the pension account was granted.
• Current pension value: same as for statutory pension scheme for employees and equally treated persons.
• Adjustments: same as for statutory pension scheme for employees and equally treated persons.

Taxation and social security contributions

• Same as for statutory pension scheme for employees and equally treated persons.