To date, the compulsory occupational pension contributions (COPC) that you mentioned are transferred by the employer at their own expense to the UAPF in favor of their employees employed in jobs with harmful working conditions, whose professions are provided for by the list of industries, jobs, occupations of workers developed by the Ministry of Labor and Social Protection of the Population of the Republic of Kazakhstan and approved by the Government of the Republic of Kazakhstan - until 01.07.2023, and from 01.07.2023 - by the Ministry of Labor and Social Protection of the Population of the Republic of Kazakhstan. The COPC is 5% of the employee's monthly income.
COPC are paid in national currency no later than the 25th day of the month following the month of payment of income, unless the employer is an individual entrepreneur applying a special tax regime based on a patent, in the manner and within the time limits provided for by the tax legislation of the Republic of Kazakhstan. The transfer of COPC is controlled by the state revenue authorities. If the employer does not timely transfer funds to the UAPF to the individual
pension saving account of the employee, subject to the actual payment and receipt of income by the employee, the state revenue authorities collect from the employer the funds to be transferred to the account in the UAPF, with an accrued penalty in the amount of 1.25 times the base rate of the National Bank of the Republic of Kazakhstan, for each day of delay (including the day of payment to the State Corporation).
Also, in accordance with the norms of the Social Code of the Republic of Kazakhstan, from January 1, 2024, the employer’s compulsory pension contributions (ECPC) will be attracted. They will be carried out only for employees born after January 1, 1975, at the expense of the agent's own funds and are set depending on the employee's monthly income. The ECPC rate from January 1, 2024 will be 1.5% of the employee's salary and will increase annually by 1% - up to 5% in 2028. This phased introduction of the ECPC will ease the burden on the employer.
The right to pension benefits at the expense of ECPC can be used by persons who have reached retirement age, as well as those with disabilities of the first and second groups, if the disability is established indefinitely, with at least 5 years (60 months) of participation in the ECPC system.
The maximum amount of pension benefit at the expense of ECPC cannot exceed two times the subsistence minimum established for the corresponding financial year by the law on the republican budget.
Pension benefits at the expense of ECPC are assigned for life, paid for the current month and are made up to the month of death or departure for permanent residence outside of Kazakhstan, inclusive.
Please note that, unlike the accumulative pension system, pension savings from ECPC in the notional funded component are not inherited, since they are not the property of the employee, they are not subject to withdrawal from the UAPF in the form of lump-sum pension benefits in order to improve housing conditions and (or) pay medical treatment from the UAPF, cannot be transferred to the trust management of the IPM, and they are not covered by the state guarantee of the safety of pension savings.