Statutory Pension and Disability Insurance Scheme
Obvezno pokojninsko in invalidsko zavarovanje
Coverage
Mandatory insurance
- Employees (workers), including civil servants and public officers.
- Self-employed persons.
- Specific groups of economically active persons, such as managing partners, farmers, persons employed within other legal relationships, foster carers (pursuing foster care as a professional activity), the clergy (persons pursuing a clerical profession).
- Specific groups of economically inactive persons, such as recipients of particular family/parental insurance benefits and home-caregivers, claimants of income replacement benefits incl. recipients of unemployment benefits, recipients of health insurance benefits after their employment had been terminated (if not insured on other statutory basis), persons on work rehabilitation (if not insured on other statutory basis).
Opting in
- Persons above the age of 15 who do not fulfil one of the requirements for statutory insurance.
- Slovenian nationals employed abroad who are not insured in the host country/not able to export credited benefits, if they were insured or possessed permanent residence in Slovenia prior to departure.
- Recipients of family, widow’s/widower’s or occupational pensions; some farmers and transferees of farming economies (special conditions apply).
Financing
General finances
- Mainly PAYG-financed from insurance contributions.
- Partly tax-financed out of the general budget (state’s obligation of co-financing is stipulated within the Pension and Disability Insurance Act).
Contribution rates
- Fixed share of monthly gross earnings (24.35%) without contribution assessment ceiling (exception: self-employed with contribution assessment ceiling of 3.5 state average annual salaries).
- Contributions shared between employees (15.5%) and employers (8.85%).
Administration
- Self-administered Pension and Disability Insurance Institute of Slovenia (sole social insurance carrier in the field).
Qualifying Conditions
Qualifying conditions
- Standard old age pension: statutory retirement age is 65; minimum insurance period: 15 years.
- Special conditions apply to persons with long insurance records: retirement age is 60, minimum insurance period: 40 years (excl. payments for missing contribution periods);the retirement age can be lowered due to child-care, military service (for men) or early opt-in (above the age of 15).
Early retirement
- Available at age 60 with minimum insurance period of 40 years (incl. additional payments for missing contribution periods), with negative (permanent) adjustments to pension benefits (0.3% per month).
Deferred retirement
- Retirement can be deferred without limit.
- Deferring retirement after reaching age 60 and 40 years of insurance periods (excl. payments for missing contribution periods) is possible with positive (permanent) adjustments to pension benefits (1.5% per 0.5 years, up to a maximum of 3 years, maximum positive adjustment: 9%).
Combining employment & retirement
- Termination of employment is a precondition for claiming full early or standard old age pension (exception: full retirement is compatible with employment on the grounds of civil law contracts (without limitations)).
- Combining ‘partial retirement' with full-time employment is possible: pension benefits are paid in advance as a bonus but shortened to 40% of the standard old age pension in the first 3 years, after 3 years, this is reduced to 20%.
- Combining partial early/standard retirement with part-time employment is possible: pension benefits are shortened proportionate to the number of working hours; if qualifying conditions for standard old age pensions are met, a pension bonus of 20% to 35% (of the 40% of the standard old age pension) is paid for the first 3 years; after 3 years the added bonus is reduced to between 10% and 17.5% (of the 40% of the standard old age pension).1
Benefits
Pension benefits
- Primarily based on the amount of contributory earnings of the most favourable 24 (consecutive) years, including pension-credited periods of e.g. child-raising.
- Maximum amount: calculation base is limited to 4 times the minimum calculation base.
- Minimum pension: is a fixed percentage (27.5% in 2020; increasing to 29.5% in 2024) of the minimum calculation base (EUR 241.62 in 2020); for persons with a calculated pension income below the minimum pension threshold.
- Yearly allowance: one-off yearly allowance provided in varying amounts to pension recipients (proportionally higher allowance rates are provided to recipients of lower pension benefits).
Benefit calculation
- Based on the following factors: (a) amount of earnings, (b) duration of insurance periods, (c) sex (transitional period for equalising pension calculations between men and women ends in 2025).
- Calculation base: contribution bases are earnings, particular reimbursements and social insurance benefits of the most favourable 24 consecutive years of insurance (reference period).
- Minimum calculation base: 76.5% of the average wage in Slovenia in the previous year, excluding average income tax and average contribution payments.
- Maximum calculation base: 4 times the minimum calculation base.
- Transformation of pensionable periods: 1 year of insurance equals 1.36% of the calculation base, 15 years of insurance equal 29.5% of the calculation base, 40 years of insurance equal 63.5% of the calculation base; additional positive adjustments can be invoked on grounds of child-care; lower percentages apply to men (until the end of the transitional period in 2025).
- Adjustments: yearly adjustment of pension value accounting for changes of gross average earnings and increase of average living costs.
Taxation and social security contributions
- Pension benefits are subject to income tax only above a certain amount (EUR 1,173 in 2020).
- Contributions for health insurance are covered by the Pension and Disability Insurance Institute of Slovenia.
Coverage
Financing
Administration
Qualifying Conditions
Benefits
Mandatory insurance
- Employees (workers), including civil servants and public officers.
- Self-employed persons.
- Specific groups of economically active persons, such as managing partners, farmers, persons employed within other legal relationships, foster carers (pursuing foster care as a professional activity), the clergy (persons pursuing a clerical profession).
- Specific groups of economically inactive persons, such as recipients of particular family/parental insurance benefits and home-caregivers, claimants of income replacement benefits incl. recipients of unemployment benefits, recipients of health insurance benefits after their employment had been terminated (if not insured on other statutory basis), persons on work rehabilitation (if not insured on other statutory basis).
Opting in
- Persons above the age of 15 who do not fulfil one of the requirements for statutory insurance.
- Slovenian nationals employed abroad who are not insured in the host country/not able to export credited benefits, if they were insured or possessed permanent residence in Slovenia prior to departure.
- Recipients of family, widow’s/widower’s or occupational pensions; some farmers and transferees of farming economies (special conditions apply).
General finances
- Mainly PAYG-financed from insurance contributions.
- Partly tax-financed out of the general budget (state’s obligation of co-financing is stipulated within the Pension and Disability Insurance Act).
Contribution rates
- Fixed share of monthly gross earnings (24.35%) without contribution assessment ceiling (exception: self-employed with contribution assessment ceiling of 3.5 state average annual salaries).
- Contributions shared between employees (15.5%) and employers (8.85%).
- Self-administered Pension and Disability Insurance Institute of Slovenia (sole social insurance carrier in the field).
Qualifying conditions
- Standard old age pension: statutory retirement age is 65; minimum insurance period: 15 years.
- Special conditions apply to persons with long insurance records: retirement age is 60, minimum insurance period: 40 years (excl. payments for missing contribution periods);the retirement age can be lowered due to child-care, military service (for men) or early opt-in (above the age of 15).
Early retirement
- Available at age 60 with minimum insurance period of 40 years (incl. additional payments for missing contribution periods), with negative (permanent) adjustments to pension benefits (0.3% per month).
Deferred retirement
- Retirement can be deferred without limit.
- Deferring retirement after reaching age 60 and 40 years of insurance periods (excl. payments for missing contribution periods) is possible with positive (permanent) adjustments to pension benefits (1.5% per 0.5 years, up to a maximum of 3 years, maximum positive adjustment: 9%).
Combining employment & retirement
- Termination of employment is a precondition for claiming full early or standard old age pension (exception: full retirement is compatible with employment on the grounds of civil law contracts (without limitations)).
- Combining ‘partial retirement' with full-time employment is possible: pension benefits are paid in advance as a bonus but shortened to 40% of the standard old age pension in the first 3 years, after 3 years, this is reduced to 20%.
- Combining partial early/standard retirement with part-time employment is possible: pension benefits are shortened proportionate to the number of working hours; if qualifying conditions for standard old age pensions are met, a pension bonus of 20% to 35% (of the 40% of the standard old age pension) is paid for the first 3 years; after 3 years the added bonus is reduced to between 10% and 17.5% (of the 40% of the standard old age pension).1
Pension benefits
- Primarily based on the amount of contributory earnings of the most favourable 24 (consecutive) years, including pension-credited periods of e.g. child-raising.
- Maximum amount: calculation base is limited to 4 times the minimum calculation base.
- Minimum pension: is a fixed percentage (27.5% in 2020; increasing to 29.5% in 2024) of the minimum calculation base (EUR 241.62 in 2020); for persons with a calculated pension income below the minimum pension threshold.
- Yearly allowance: one-off yearly allowance provided in varying amounts to pension recipients (proportionally higher allowance rates are provided to recipients of lower pension benefits).
Benefit calculation
- Based on the following factors: (a) amount of earnings, (b) duration of insurance periods, (c) sex (transitional period for equalising pension calculations between men and women ends in 2025).
- Calculation base: contribution bases are earnings, particular reimbursements and social insurance benefits of the most favourable 24 consecutive years of insurance (reference period).
- Minimum calculation base: 76.5% of the average wage in Slovenia in the previous year, excluding average income tax and average contribution payments.
- Maximum calculation base: 4 times the minimum calculation base.
- Transformation of pensionable periods: 1 year of insurance equals 1.36% of the calculation base, 15 years of insurance equal 29.5% of the calculation base, 40 years of insurance equal 63.5% of the calculation base; additional positive adjustments can be invoked on grounds of child-care; lower percentages apply to men (until the end of the transitional period in 2025).
- Adjustments: yearly adjustment of pension value accounting for changes of gross average earnings and increase of average living costs.
Taxation and social security contributions
- Pension benefits are subject to income tax only above a certain amount (EUR 1,173 in 2020).
- Contributions for health insurance are covered by the Pension and Disability Insurance Institute of Slovenia.
1 The same added bonus rules apply to persons partially re-entering the labour market, who are entitled to 12.5% to 75% of their pension benefit (percentage depends on number of working hours).
Legal Basis: Pension and Disability Insurance Act (Zakon o pokojninskem in invalidskem zavarovanju), Social Security Contributions Act (Zakon o prispevkih za socialno varnost).