The accumulative pension system of Kazakhstan is maximally protected from risks. Today, Kazakhstan is the only country in the world that guarantees the safety of citizens' pension savings from inflation from the state. If, upon retirement, the profitability of savings is lower than inflation, then this difference is compensated to the recipient at the expense of the republican budget when they receive their first pension payment from the UAPF.
With the introduction of the Social Code, depositors are given the opportunity to transfer up to 50% of pension savings to trust management through mandatory and mandatory professional pension contributions to investment portfolio managers (IPM). Already without taking into account the threshold of minimum sufficiency. If the depositor has a pension annuity agreement, then it is possible to transfer up to 100% of the amount of mandatory pension savings to the IPM. You can also transfer your voluntary savings to the IPM in full. At the same time, it should be noted that the state provides a guarantee of the safety of mandatory types of pension savings only to that part of savings that is managed by the National Bank of the Republic of Kazakhstan. The company chosen by the depositor is responsible for the safety of pension savings transferred to private management. It is the IPM that is responsible with its capital for ensuring a minimum level of profitability, which is calculated based on the weighted average return on pension assets.
If the depositor decides to transfer part of the pension savings to the trust management of the IPM, it is recommended to familiarize yourself with the current list of management companies on the market, study their investment declarations on the UAPF website, reviews of investment activities, learn more about the experience and results of the selected company.
Kazakhstanis can make pension payments several years earlier than the traditional retirement age. To do this, it is necessary to conclude a pension annuity agreement with a life insurance company (LIC). But in order to conclude such an agreement, a depositor of the Unified Accumulative Pension Fund (UAPF) must have pension savings of at least a certain amount established by the law on the republican budget and effective on January 1 of the corresponding financial year.
The difference between payments is that they are made from the UAPF until the savings are exhausted, and from the LIC – for life, regardless of whether the amount of payments exceeded the amount of transferred savings or not. At the same time, they are both indexed annually. Another difference is that in the event of the death of the recipient of payments, his relatives have the right to inherit pension savings stored in the UAPF, while those transferred to the LIC cannot. However, if there is a guarantee period in the pension annuity agreement, the heir of the deceased will receive insurance payments until its end.
If there is a shortage of funds, one can combine the pension savings of close relatives and issue two pension annuity agreements. A joint annuity is a product that implies the participation in a pension annuity agreement of two policyholders (insured) who are spouses or close relatives in accordance with the Code of the Republic of Kazakhstan "On Marriage (Matrimony) and Family" and at the same time insured. Unlike a classic pension annuity, a joint one allows you to combine pension savings and redistribute income under a pension annuity agreement.
The Social Code of the Republic of Kazakhstan, which entered into force on July 1, 2023, contains rules governing the introduction of mandatory employer pension contributions (MEPC).
From January 1, 2024, the functions of the UAPF will be supplemented by MEPC, which will be carried out at the expense of the employer's own funds and only for employees born after January 1, 1975. The amount of MEPC is calculated from the monthly income of each employee: from January 1, 2024 in the amount of 1.5% with an annual increase to 5% in 2028.
According to the Social Code, MEPC will be paid by employers not for all employees, but only for those born in 1975 and later. Therefore, employees who will retire only in 2038 will begin to receive payments at the expense of the MEPC.
The value of the MEPC is determined from the monthly income of the employee, which is accepted for calculating the MEPC:
- from January 1, 2024 – in the amount of 1.5 percent;
- from January 1, 2025 – in the amount of 2.5 percent;
- from January 1, 2026 – in the amount of 3.5 percent;
- from January 1, 2027 – in the amount of 4.5 percent;
- from January 1, 2028 – in the amount of 5 percent.
Поэтапное внедрение ОПВР, уплата их только за работников с 1975 года рождения, а также отнесение их к вычетам из налогооблагаемого дохода предусмотрено для выравнивания нагрузки на работодателя.
ОПВР уплачиваются в ЕНПФ работодателями (как налоговыми агентами) через Государственную корпорацию «Правительство для граждан» с приложением списков работников - физических лиц, за которых перечисляются ОПВР.
The monthly income of an employee considering for calculating the MEPC must be at least the minimum wage and must not exceed 50 times the minimum wage established for the corresponding financial year by the law on the republican budget.
The phased implementation of the MEPC, payment only for employees born after 1975, and their inclusion as deductions from taxable income are introduced to balance the employer’s burden.
MEPC are remitted to the UAPF by employers (as tax agents) through the State Corporation "Government for Citizens", accompanied by lists of individual employees for whom the contributions are transferred.
The UAPF consistently recommends its depositors (recipients) to monitor the state of their pension savings in an individual pension account (IPA), including paying attention to the timely transfer/receipt of pension contributions/OPP to your individual pension account (IPA) at UAPF. Unfortunately, there are cases when the employer fails to fulfill or fulfills their obligations incompletely. Therefore, it won’t hurt to systematically check the state of pension savings in your IPA.
Receiving an extract from an IPA is a legally enshrined right of depositors (recipients). Currently, the most convenient way to get information about savings is a personal account on the UAPF website or in the mobile application. To use this method of informing, you need to register once in your personal account. You can do this by receiving an SMS that will be sent to the phone number registered in the UAPF database. You can also register using an electronic digital signature, or by visiting any branch of the UAPF.
In addition, there are ways to obtain information about savings selected by depositors and recipients earlier: by e-mail to the address provided in the UAPF, by personal visit to the UAPF office, and through postal services.
We remind the depositor (recipient) that it is necessary to inform the UAPF within 10 calendar days about any changes that affect the fulfillment of UAPF’s obligations.
We remind that the right to use part of their pension savings for housing and (or) treatment can be used by:
- depositors with savings exceeding a certain threshold of sufficiency;
- retired pensioners – within the limits of no more than 50% of the remaining amount of pension savings in the UAPF, provided that the total amount of their pension (including an age or length of service pension, basic pension) ensures replacement of lost income at a level corresponding to international standards (at least 40%);
- persons who have concluded pension annuity agreements with insurance companies that provide them with lifetime annuity payments;
- pensioners based on length of service – they have been granted the right to use the entire amount of their pension savings formed at the expense of the pension fund.
If you belong to one of these categories of citizens, you can use your retirement savings an unlimited number of times.