At the end of last year, Ukraine passed a law that simplifies the mechanism of voluntary participation of citizens in mandatory state pension insurance – without paperwork, without visiting state institutions.
Who can participate?
Voluntary participation in pension insurance can be taken by both insured and uninsured persons older than 16 years. It is also possible to pay insurance premiums in favor of third parties.
The conditions for voluntary participation are:
availability of information about such persons in the register of insured persons of the State Register of mandatory state social insurance;
such persons are not assigned a pension in the solidarity system of mandatory state pension insurance.
How to use?
It is necessary to conclude an Agreement with the Pension Fund of Ukraine, pay contributions – for yourself or for the benefit of another person.
The contract is concluded in electronic form through the web portal of electronic services of the Pension Fund of Ukraine by joining the Model Contract on Voluntary Payment of Insurance Contributions. To do this, you need to authorize using a qualified electronic signature (QES), Action.Signature or the GOV.ID system.
Who determines the amount of contributions and the term of their payment?
A person independently determines how long he wants to pay premiums after concluding the Agreement, the frequency of payment of insurance premiums and their amount.
How to report on paid funds?
Paid contributions are recorded automatically after receipt of funds in the Fund’s account. Information on the payment of contributions does not require the submission of any reports.
The payment notification will be sent to the personal account of the insured person to whose benefit the contributions have been paid, on the web portal of electronic services of the Pension Fund of Ukraine.
What are the advantages?
Paid contributions are the acquired insurance experience or increased salary for the future pension.
How will it work?
The sums of paid insurance premiums are credited for the month in which the funds were deposited into the account of the Pension Fund of Ukraine. This month will be included in the insurance period and the salary will be taken into account for it – for uninsured persons, and for insured persons – the salary will be increased to calculate the pension.
If, for example, 2,000 hryvnias have been paid under the Agreement for a certain month, then for the insured person, the monthly earnings, which will be taken into account when calculating the pension, will increase by more than 9,000 hryvnias.
In fact, every 100 hryvnias of the voluntarily paid contribution increases the monthly salary, which will be taken into account for determining the pension, by almost 455 hryvnias.
If, taking into account the voluntarily paid insurance contributions and the single contribution actually paid by the employer for the insured person, the salary for the corresponding month exceeds the maximum amount from which insurance contributions are paid, part of the insurance contributions will be credited to the following month’s account.