Employers must offer and subsidize company pension schemes
Created: 04/13/2022, 12:06 p.m
By: Janine Napirca
Employers are obliged to offer employees company pension schemes – and to subsidize them.
© Steinach/Imago
Since January 2022, employers have been obliged to subsidize all contracts for company pension schemes with 15 percent.
Provision
for old age
is something that basically everyone has to deal with sooner or later.
Because if you don't make provisions in good time, you will find it difficult to make ends meet financially in old age.
The
statutory pension
is often no longer sufficient – despite pension increases – to maintain the financial standards that were taken for granted during working life.
So that you don't have to tighten your belt when you retire, it's a good idea to make provisions.
This can be done with pension funds, for example, but
company pension schemes
are also a way of making provisions for retirement.
According to a press release from the
Bavarian wage tax aid
,
employers
have been obliged since the beginning of this year to also
subsidize old contracts for company pension schemes
.
In the following you will find out why company pension schemes are not only worthwhile for employees, but also for the employer.
From 2022, the employer must subsidize all contracts concluded for company pension schemes
The notification shows that
since January 1, 2022
, old contracts for company pension schemes must also be subsidized by the employer with 15 percent
.
The company pension scheme is interesting for employees because the contributions to some forms are
tax- and social security-free
.
Employers have had to pay a 15 percent subsidy for newly concluded contracts since 2019, and this also applies retrospectively to previously concluded contracts.
Employers must offer company pension schemes for employees
According to the notification, employers have been obliged to make company pension schemes possible for their employees
since 2002
.
Part of the gross salary is paid into a contract for company pension schemes every month.
This is called
pay conversion
.
As a rule, however, it is up to the employer to decide which model of company pension plan to offer.
Some people have not paid enough into the pension insurance during their working life and therefore have considerable financial difficulties in old age - read here about who is entitled to a basic pension.
Tip from the wage tax assistance in Bavaria
Employees can use the topic of company pension schemes in salary negotiations.
Because if there is no more gross salary, you can negotiate an increase in the subsidy for the company pension scheme.
This is often cheaper
for the employer than a salary increase
.
You will not receive a higher salary, but you will have a higher pension later.
Why company pension schemes are still worthwhile for employers
On the one hand, employers are legally obliged to offer employees company pension schemes.
On the other hand, it is also worthwhile for the employer.
After all, he still saves five percent on social security contributions, according to the announcement.
In addition, the employer can deduct the grants from tax as business expenses.
(jn)
