How can I use part of my pension savings to improve housing conditions, pay for medical treatment and (or) to transfer to an investment portfolio manager?

How can I use part of my pension savings to improve housing conditions, pay for medical treatment and (or) to transfer to an investment portfolio manager?

According to the law “On Amendments and Additions to Certain Legislative Acts of the Republic of Kazakhstan on Restoring Economic Growth”, citizens have the right to use part of their pension savings to improve their living conditions and (or) pay for treatment that is not included in the guaranteed volume of free medical care and compulsory social medical care. insurance, as well as for transfer to investment management by private management companies.

The right to use part of their pension savings in order to improve housing conditions in their favor or to their spouse (wife) or close relatives, and (or) to pay for treatment for themselves or their spouse (wife) or close relatives, can be used by the following persons who have pensions in the UAPF savings formed at the expense of mandatory pension contributions (OPC) and (or) mandatory occupational pension contributions (OPPC):

1) The amount of pension savings of which exceeds the minimum pension savings adequacy threshold.

At the same time, the lump-sum pension payment cannot exceed the amount of the difference between the amount of pension savings at the expense of the CPC and (or) the CPC of the contributor (recipient) and the threshold for the minimum adequacy of pension savings, calculated in accordance with the Methodology for determining the threshold for the minimum adequacy of pension savings, approved by the Government of the Republic of Kazakhstan, as of the date receiving an electronic notification from an authorized operator;

2) For which the size of the pension provides a replacement rate for the average monthly income of the recipient at a level not lower than 40 percent, determined in the manner determined by the Government of the Republic of Kazakhstan.

At the same time, the one-time pension payment cannot exceed 50 percent of the amount of pension savings at the expense of the CPC and (or) CPC of the contributor (recipient) as of the date of receipt of the initial electronic notification from the authorized operator;

3) Those who have entered into a pension annuity agreement with an insurance organization;

At the same time, the one-time pension payment cannot exceed the amount of pension savings at the expense of the CPC and (or) CPC on the individual pension accounts of the contributor (recipient).

To exercise the right to use a part of pension savings, citizens will first of all have to check their pension savings and make sure that the amount available for withdrawal is available on their individual pension account in the UAPF.

On the Fund’s corporate website enpf.kz in the Personal Account, as well as in the updated mobile application of the UAPF, Telegram, it is possible to check online information about the amount available for withdrawal.

Two methods of authorization are available in the Personal Account on the Fund's corporate website and in the mobile application: enter the IIN and password or use an electronic digital signature. Also, the next time you log into the mobile application, you can use Touch ID or Face ID, if available on your mobile device. For convenience, the user can choose the language of service: Kazakh or Russian.

Those contributors (beneficiaries) who, after checking their pension savings in the UAPF, have decided to use part of their pension savings to improve their living conditions and (or) pay for treatment, will have to contact the authorized operator through the Internet portal of the authorized operator to open a special account and filing an application for a one-time pension payment (hereinafter referred to as the application for payment) using an electronic digital signature (EDS).

At the same time, when submitting an application for payment to an authorized operator, the contributor (recipient) must himself choose the method of paying individual income tax (IPT) for a one-time pension payment (recall, when transferring contributions to the UAPF, IIT is not collected), indicating the chosen method in the application for withholding the IIT , which is also signed with digital signature.

That is, citizens themselves indicate to the UAPF at what point to withhold the PIT from the amount of the lump-sum pension payment: immediately in full at the time of payment, or withhold the PIT in the deferred period (monthly in equal installments upon reaching retirement age according to the pension payment schedule).

The authorized operator within 2 (two) working days will send an electronic notification to the UAPF, which will contain information about the accepted application for payment, including data on the purpose of the withdrawal, full name, DR, IIN, on the amount of the lump-sum pension payment in the amount determined by the contributor (beneficiary), on the methods of withholding the PIT, with an application for withholding the PIT, also signed by the contributor's (beneficiary's) EDS, attached to the electronic notification.

After receiving an electronic notification from the authorized operator, the UAPF transfers the amount of the contributor's (beneficiary's) lump-sum pension payment to the authorized operator within 5 working days, which in turn will credit it to the special account of the contributor (beneficiary).

The amount of the lump-sum pension payment can be kept on a special account of the contributor (beneficiary) opened with an authorized operator (Otbasy Bank JSC) for no more than 45 working days.

During this period, the contributor (recipient) must provide the authorized operator with documents for the intended purpose, or if they are not provided within the specified time, the amount of the lump-sum pension payment must be returned by the authorized operator to the UAPF, which will credit them to the individual pension account of the contributor (recipient).

Thus, all appeals from citizens regarding the improvement of living conditions and (or) payment for treatment will be received and considered by the authorized operator on the principle of "one window" and a separate appeal to the UAPF by citizens will not be required, with the exception of their independent online receipt of information in the UAPF about the amount of pension savings available for withdrawal.

In addition to withdrawals of pension savings in order to improve housing conditions and (or) pay for medical treatment, from 2021 citizens will also be able to participate in the management of their pension savings at the expense of CPC and (or) CPC through self-selection of investment portfolio managers (IPMs) offering various investment strategies. To transfer part of the pension savings to the UIP, the contributor must submit an application in the form established by the UAPF internal document by personally contacting the UAPF regional offices or remotely via the UAPF Internet resource using an electronic digital signature.

Please note that the right to use part of your pension savings for transfer to the PIS can be used only after the appearance on the financial market of Kazakhstan of the PIS, determined by the Agency of the Republic of Kazakhstan for the regulation and development of the financial market, with which the UAPF will conclude agreements on trust management of pension assets, and as well as custodial agreements.