Contrary to popular belief, caring for future deductions from the budget includes not only official employment and the payment of assessed contributions to the FIU, but also the opportunity to choose the option for the development and formation of future subsidies. In order not to regret the loss of profits and receive decent benefits when you reach a certain age, you need to understand how the deductions from the budget in Russia are calculated, what is insurance and what is an accumulative pension, the procedure for the formation and payment of mandatory contributions from the employer. Having made a choice, citizens will be able not only to find out the amount of deductions from the budget, but also to index their savings.
Accumulative pension: characteristics and features
Pension in Russia is divided into 2 types: insurance and funded parts. The first contributions go to the payment of benefits to workers who have already reached retirement age, as well as to social pensions (not related to old age). The funded part is the deduction of the employer to the Management Company or Non-State Pension Fund. The funded pension will be paid after the employee reaches a certain age.
The formation of an insurance pension (and funded pension) can be carried out in 2 ways:
- 6% - in the authorized capital or non-state pension funds for the subsequent indexation of accumulated funds, and 10% - for insurance payments;
- all 16% - on contributions to pensioners.
In the first case, the employee needs to contact the branches of the PF of the Russian Federation in order to write a statement about the transition to the NPF or the Criminal Code. In the second, on the contrary, there is no need to go anywhere - this will mean a voluntary refusal to form a funded pension in order to accrue insurance payments for current recipients of budget funds.
Transfer of pension contributions to non-state pension funds: features
In order to increase the amount of future deductions from the employer to the FIU, a citizen must decide on the choice of which organization will receive his funded pension. The formation, investment, payment and inheritance of contributions will directly depend on the correct decision of the employee.
Those citizens who until the end of December 2015 did not choose a company that would be involved in the indexation of assessed contributions (OPS) are considered “silent”. The funded pension, the procedure for its formation and payments for the “silent” remain in the past - now all pension payments will be a one-time part and indexed depending on the state of the country's economy and the size of the budget. From January 1 of this year, 6% of savings will automatically go to the insurance part, which is designed to pay benefits to pensioners.
Workers born in 1967 (and subsequent periods), who have decided on the choice of a non-state pension company, take responsibility for the state of mandatory contributions from the employer.
When choosing between the state and the NPF (or the Management Company), it should be borne in mind that the transfer of the cumulative share of pension contributions to another management company or fund is carried out once a year, and if you change your decision regarding the “fate” of budget allocations, you must re-apply to the branch of the RF PF. However, when changing a non-state pension fund with a time period of less than 5 years, the indexation deductions received for the period of staying in the previous company burn out.
FIU or NPF: which is better?
Facing the choice of how to use the funded part of the pension, citizens of the Russian Federation need to decide which direction is a priority for them.
In case of refusal to transfer pension savings to NPFs or UK, the amount of social contributions depends entirely on the state of the country's economy and the size of its budget. The state guarantees annual indexation of insurance payments taking into account inflation growth and adjustment factors. A funded pension, the procedure for its formation and payment in this case are not taken into account.
The level of coefficients that adjust the total amount of insurance premiums will be significantly lower for the state than for private companies, since their indexation is related to the state of the company in the insurance market. That is, Russian citizens have a choice: to stay in the Pension Fund and be guaranteed to receive insurance payments when they reach a certain age, or to transfer the accumulative contributions of a private company, where they will be additionally indexed.
If the company's activity over the past year has been successful, the amount of trade payments for the funded pension may be higher than the insurance part proposed by the state. However, there is a risk of lost profits: in the event that an NPF or a management company conducted a loss-making campaign, there will be no additional payment for the funded pension.
How to choose NPF and UK?
When choosing an NPF or a management company, first of all, you should pay attention to the availability of a license that gives the right to engage in the provision of services for social protection organizations and NGOs. The presence of a license guarantees the organization fulfills its obligations on pension insurance and security, namely: indexation of employee contributions based on NPF profitability ratios, up-to-date information on the level of insurance savings, full payment of funds in a one-time form or with separation by periods.
The funded pension is paid by the company that the employee chose last (in the case of a change in pension funds). It is important to know that the presence of a license does not necessarily indicate the successful activity of the company for the current period, and no company gives a 100% guarantee that the contributions of payers will be indexed.
In addition to the license, the employee should carefully study the activities of the NPF or the UK, compare customer reviews with the promises of company employees, and study agency ratings.
Independent agencies (for example, Expert RA) assign a reliability rating to licensed non-state companies that is accessible to users of the network: the higher this indicator, the greater the chance that a citizen will not have problems getting a funded part of the pension at pension funds when they reach retirement age or CC. The number of clients who have entrusted their savings, experience in the insurance business and the lack of dissatisfaction on the part of participants in the insurance program also play an important role in determining the candidate.
What to do if a non-state pension fund was taken away a license?
Since 2015, the Central Bank has tightened requirements for private pension funds and the Criminal Code, in particular for the provision of pension services to the population of the Russian Federation. The consequence of this was numerous license reviews from companies that did not pass a security check.
One of the decisions that led to the deprivation of the right to engage in activities in the field of social protection organizations and NGOs was the non-compliance with the requirements of the legislation of the Russian Federation on the amount of pension savings, which serve as a guarantee of fulfillment of obligations to fund members.
Citizens whose APFs or CCs have lost their licenses can transfer their contributions to another company, for example, to the RF PF, which will be responsible only for the formation of an insurance pension (and there will be no funded pension in this case), or another non-state fund.
Since 2015, Russia has been operating a system of guaranteeing pension contributions based on the principle of bank deposit insurance, which protects the accumulated funds of employees, which will be paid in full from the funds of the RF PF or NPF (UK).
How to find out the size of your future pension?
Upon transition to a private pension fund or management company, a funded pension, the procedure for its formation and payment will be displayed on the company's website. To do this, you need to register in the "My Account", having passed the necessary identification. In any non-governmental fund, when entering the site, the full name of the employee, the contract number of the OPS or NGO and SNILS must be indicated. As additional details, they may require a residence address, information about the employer and an extract from the work book.
After registration in the "My Account" the following information will be available to the program participant:
- Date of conclusion of the OPS or NGO agreement.
- Status of the contract (current, suspended, closed).
- The total amount of accumulated funds.
- The amount of interest accrued for the period from the moment of joining the NPF or the UK to the current period.
- Statement of pension account transactions (income from the employer, personal contributions, indexing).
- Cumulative part transferred from another non-state pension fund (in case of transfer from one company to another).
To accurately calculate the size of the future pension, the user of the resource can use the calculator, which online calculates what payments are due to the payer after the end of work. The calculations are based on the age of the participant, gender, start of employment and official salary. The principle of operation of the calculator is simple: the higher the level of remuneration for work, the greater the amount of the pension paid to the payer.
The calculation of the main part of the retirement pension on the PFR website takes place according to the same principle.
In addition, users can use the free service: order extract from the RF PF. A report on the status of the pension account and accrued benefits is generated once a year. The funded part of the pension, the procedure for its formation and payment in the PFR report will not be reflected.
How to get the funded part of the pension?
After the employee has reached a certain age (60 years - male, 55 - female), he is entitled to pay savings, which he can receive at the PFR or non-governmental fund (UK). The amount of contributions due to the employee will depend on how long the OPS contract was concluded, on the level of wages and the state of non-state pension funds. If the fund's activity was successful, then the funded pension, the formation of which began from the date of conclusion of the OPS contract, will be paid taking into account profitability ratios individual for each commercial organization. If the size of the investment portfolio of an NPF or an asset management company was small during the term of the contract, or if the company experienced difficulties in the financial market, then the accumulated funded part of the pension, taking into account the accrued interest, will be small, or there will be no allowances at all.
The funded pension, the procedure for the formation and payment completely depend on the activities of the company, and if the total amount of accruals does not suit the payer, you can contact the management of the company with a request to revise the correction factor.
In each company, the payment of the funded part is made in its own way, and any of the companies allows the program participant to choose a convenient method of crediting: at a time in the form of a total amount or in the form of annuity payments, broken down by months.
To receive payments, an employee must reach the required age and have supporting documents with him: a passport of the Russian Federation, a pension certificate, SNILS and an OPS agreement. If the method of receiving payments implies a bank account, then you need to take the details for the transfer. At the Russian Post Office a service fee will be charged in accordance with the organization’s tariffs.
Payment of the funded part of the pension to successors
The funded pension law establishes that in the event of a citizen's death, his pension contributions will be paid to successors. In order to independently determine the circle of persons to whom the payment will be paid, the participant of the voluntary pension insurance program or NGO must contact the FIU (if he is “silent”) or an NPF and write a statement on the distribution of the circle of persons to whom the benefits will be paid.
In the event that the employee has not independently determined who is entitled to the funded pension, the immediate right to receive contributions belongs to his immediate family: children, spouse, parents.
Siblings / brothers, grandchildren, as well as grandparents are the second in a row persons to whom a funded pension will be paid. The procedure for its formation will not differ from payment to previous relatives.
To receive pension contributions, relatives must contact the PFR or NPF department within 6 months from the date of death of the program participant and provide a package of documents confirming the connection and the right to receive payments. The FIU makes a decision on accrual / refusal within 5 days, non-state companies - up to 14 business days.
Deductions will be made no later than the 20th day of the month following the date of receipt of the application.
OPS and NGOs: what is the difference?
Those who want to index their insurance savings have repeatedly faced the problem of which method is more profitable: private pension provision or compulsory pension insurance.
In both the first and second cases, employee accumulations transferred to the Pension Fund will be indexed.
The main difference between the programs is that in the case of the OPS contract, the pension savings are deducted by the employer, and with an NGO, the employee himself is obliged to make payments (DSA) to the FIU. And if at the TSA payments depend on the level of the participant’s salary, then at the DSA the client chooses the amount of deductions (but not less than the amount established by the contract).
Thus, the voluntary pension insurance scheme and NGOs are related programs (as the concepts of funded pension and urgent pension payment), the only difference is in the way of making contributions.
Pension funded moratorium
Since January 1, 2014, the Government of the Russian Federation “froze” the funded pensions of citizens for an indefinite period. This decision was made in connection with the changes associated with the reorganization of the pension fund system, each of which must pass the Central Bank's verification of the fulfillment of all obligations to the parties to the agreement. The companies that passed the audit automatically received a perpetual license to provide pension services to the population and entered into a pension savings insurance program. The extension of the moratorium in 2016 was associated with a budget deficit and the difficult state of the Russian economy.
The funded pension, the procedure for its formation and payment in 2016 will still not be indexed.
Thus, this article was devoted to the urgent, interesting to many pension issues (the procedure for formation, payments, legal justification) and possible nuances in this area.