Pensions and retirement plans—Germany—Q&A guide
Pensions and retirement plans—Germany—Q&A guide

The following Pensions practice note provides comprehensive and up to date legal information covering:

  • Pensions and retirement plans—Germany—Q&A guide
  • 1. What are the main statutes and regulations relating to pensions and retirement plans?
  • 2. What are the primary regulatory authorities and how do they enforce the governing laws?
  • 3. What is the framework for taxation of pensions?
  • 4. What is the state pension system?
  • 5. How is the state pension calculated and what factors may cause the pension to be enhanced or reduced?
  • 6. Is the state pension designed to provide a certain level of replacement income to workers who have worked continuously until retirement age?
  • 7. Is the state pension system under pressure to reduce benefits or otherwise change its current structure in any way on account of current fiscal realities?
  • 8. What are the main types of private pensions and retirement plans that are provided to a broad base of employees?
  • 9. Are employers required to arrange or contribute to supplementary pension schemes for employees? What restrictions or prohibitions limit an employer’s ability to exclude certain employees from participation in broad-based retirement plans?
  • More...

Pensions and retirement plans—Germany—Q&A guide

This Practice Note contains a jurisdiction-specific Q&A guide to pensions and retirement plans in Germany published as part of the Lexology Getting the Deal Through series by Law Business Research (published: January 2020).

Authors: Schweibert Lessmann—Jochen Leßmann; Rüdiger Hopfe

1. What are the main statutes and regulations relating to pensions and retirement plans?

In Germany, the old-age pension is based on three systems: the statutory old-age pension, occupational pension schemes and private retirement savings plans.

For the statutory pension, the main statute is the Social Security Code VI.

For occupational pension schemes, the Company Pension Act (BetrAVG) is the main relevant statute. The BetrAVG, among other things, implements Directive 2014/50/EU. The BetrAVG does not, in general, provide the basis for the pension claim itself, but rather forms the legal basis for the rights and duties of employers and employees relating to occupational pension schemes. The pension claims and the details are usually specified in the individual plan rules implemented by the employer, which are subject to general employment and labour laws.

The BetrAVG also provides regulations for the statutory insolvency protection fund.

2. What are the primary regulatory authorities and how do they enforce the governing laws?

Employers’ obligations in relation to the state pension system (which are mostly contribution obligations) are regulated by the public institutions competent for pensions, in particular the German Statutory Pension Insurance Scheme.

Occupational

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