1. I'm retiring in a couple of months. When and where should I apply?

To assign both a basic and PAYG pension from the state budget, and pension benefits from the UAPF at the expense of compulsory pension contributions and (or) compulsory occupational pension contributions, you need to apply with a single application and a package of documents to the divisions of the State Corporation "Government for Citizens" ( PSC) at the place of residence.

You can do this 10 days before reaching retirement age.

We remind you that the generally established retirement age for men is 63 years, for women in 2022 - 60.5 years with an annual increase of six months until reaching 63 years in 2027.

 

1. My spouse wants to transfer his pension savings over the sufficiency threshold to the management of investment companies. I doubt if they can be trusted?

From January 2021, contributors and beneficiaries can participate in investing their pension savings by choosing their own portfolio management company (IPM).

Now the UAPF has concluded agreements on trust management of pension assets with 4 companies that meet all the requirements established by the Agency of the Republic of Kazakhstan for the regulation and development of the financial market (ARRFR), have a license to operate in the securities market (investment portfolio management activities):

·        Jusan Invest JSC

·        Halyk Global Markets JSC

·        BCC Invest JSC

·        Centras Securities JSC

 Information about each of the IPMs (including the investment declaration, as well as information about the IPM commission fee) is posted on the enpf.kz website in the "Services" section - "Transfer of a part of pension savings to IPM's trust management". An overview of the investment activities of management companies can also be found on the website enpf.kz in the section "Indicators" - "Overview of investment activities" or "Brief overview of the investment portfolio of pension assets".

After receiving pension assets from UAPF, IPM invests them in permitted financial instruments specified in the Rules for the implementation of investment portfolio management activities, approved by the Resolution of the Board of the National Bank of the Republic of Kazakhstan dated February 3, 2014 No. 10 and provided for in the IPM Investment Declaration.

IPMs are entitled to an investment management fee under the Law on Pension Provision. The maximum amount of IPM remuneration cannot exceed 7.5% of the received investment income. The actual amount of the commission is approved annually by the IPM management body and can change no more than once a year.

It is important to know that during the period when pension savings are under the control of the National Bank until the contributor reaches retirement age, there is a guarantee of the safety of pension savings, taking into account the level of inflation. When transferring pension savings to the management of IPM, the state guarantee is replaced by the guarantee of the management company to ensure the minimum level of return on pension assets, which is calculated based on the weighted average return on pension assets transferred to the management of IPM operating on the market.

 

1. How pension benefit payments from UAPF have changed in 2022?

Pension benefits from the UAPF are paid in accordance with the Methodology approved by the Decree of the Government of the Republic of Kazakhstan dated October 2, 2013 No. 1042 (as amended from April 1, 2021). According to this Methodology, payments from the UAPF to retirees are calculated as follows: the amount of pension savings is multiplied by the pension savings payment rate - 6.5% and divided by 12. This is how the amount of monthly benefit payments from the UAPF in the first year of their receipt is obtained. For beneficiaries of certain categories: persons with disabilities of group 1 or 2, if disability is established indefinitely, as well as beneficiaries of pension benefits for whom compulsory occupational pension contributions have been paid in the aggregate for at least sixty months, the Methodology for calculating pension benefits provides for adjustment coefficients.

In subsequent years, the size of the monthly pension payment is increased annually by the indexation rate of pension payments - 5%.

Thus, from January 1, 2022, last year's pension payments from the UAPF are indexed by 5%.

It should be noted that the monthly pension payment from the UAPF is made in the amount of at least 70% of the subsistence minimum (the subsistence minimum in 2022 is 36,018 tenge). Accordingly, from January 1, 2022, the minimum payment from the UAPF will be 25,212.60 tenge (36,018 * 70%).

If the amount of pension savings on the date of application for benefit does not exceed twelve times the minimum pension established by the Law on the republican budget for the corresponding financial year, this amount is paid to the beneficiary from the UAPF at a time (in 2022 - 555,624 tenge = 12 * 46,302 tenge).

At the same time, it should be noted that for pensioners who exercised the right to receive pension benefits before January 1, 2018, in 2022 the calculation is as follows: the annual amount of their pension benefit is the largest of thirty times the minimum pension (in 2022, 30 x 46,302 = 1 389,060 tenge) and the product of the amount of pension savings by the coefficient of the current value of pension savings at the corresponding age of the beneficiary. Payments are made according to the previously selected schedule.

Recall that pension benefits from the UAPF are paid until the pension savings on the individual pension account are exhausted.

           

1. I am interested in increasing the threshold for the adequacy of pension savings for the possibility of using part of them for housing or medical treatment. For example, my birthday is April 25, 1983, until April 25, 2022 the threshold will be, as now, 3,220,000 tenge? Or from January 01,2022 my threshold has increased to 5,640,000 tenge?

 

The Law of the Republic of Kazakhstan On Pension Provision in the Republic of Kazakhstan (hereinafter referred to as the Law) determines that the threshold for the minimum adequacy of pension savings is the minimum amount of pension savings formed from compulsory pension contributions and (or) compulsory occupational pension contributions necessary to ensure a monthly pension not less than the amount of the minimum pension established by the law on the republican budget.

The thresholds for the minimum adequacy of pension savings (hereinafter referred to as MAP) are calculated annually in accordance with the Methodology for determining MAP, approved by Decree of the Government of the Republic of Kazakhstan dated January 6, 2021 No. 1. This Methodology is an open regulatory legal act and is freely available on the Internet, including on the Fund’s website. In the Methodology, the algorithm for calculating the PMD is described in great detail.

Thus, when calculating the MAP, the UAPF uses the relevant parameters established by the Methodology, including those presented on an annual basis by the Ministry of Labor and Social Protection of the Population of the Republic of Kazakhstan, agreed with the Ministry of National Economy of the Republic of Kazakhstan.

At the same time, Decree of the Government of the Republic of Kazakhstan dated December 13, 2021 No. 875 made an addition to the Decree of the Government of the Republic of Kazakhstan dated January 6, 2021 No. 1, according to which it was established that the MAP calculated for 2021 are valid until April 1, 2022.

Subject to the foregoing, and including the fact that the size of the MAP is reviewed annually by the UAPF, in your case, the MAP will be:

from April 25, 2021 to March 31, 2022 inclusive 3 million 220 thousand tenge;

from April 1, 2022 to April 24, 2022 inclusive - 5 million 490 thousand tenge;

from April 25, 2022 to December 31, 2022 inclusive - 5 million 640 thousand tenge.

We note that on the part of UAPF, the amount available for withdrawal is checked taking into account the MAP on the day the electronic notification is received from the authorized operator.

 

1. I have entered into an ICA, but at the moment I do not receive income from it, can I make contributions in my favor?

If an independent contractor agreement (ICA) is concluded with an individual who is not a withholding agent, then you yourself have the right to make contributions in your favor in the amount of at least 10% of the income received, but not more than 10% of 50 times the minimum wage established for the corresponding financial year by the law on the republican budget (MRZP in 2022 is 60 thousand tenge).

If the ICA is concluded with a tax agent (individual entrepreneur, legal entity, as well as a person engaged in private practice), then in the absence of payment, he does not make compulsory pension contributions to your individual pension saving account.

Since at the moment you do not receive income, you can independently make deductions of voluntary pension contributions (VPC) in your favor at the expense of your income, through second-tier banks. The amount and frequency of payment of VPC are established by an individual independently.

If you are not a self-employed person, you can also make contributions to the Single Aggregate Payment (SAP). According to Article 774 of the Tax Code of the Republic of Kazakhstan dated December 25, 2017 No. 120-VI On taxes and other obligatory payments to the budget, SAP payers are individuals who carry out entrepreneurial activities without registering as an individual entrepreneur, who simultaneously meet the following conditions:

1) paid SAP;

2) do not use the labor of employees;

3) provide services exclusively to individuals who are not tax agents, and (or) sell exclusively to individuals who are not tax agents, agricultural products of personal subsidiary plots of their own production, with the exception of excisable products. At the same time, the amount of the SAP payer's income received as a result of carrying out the types of activities specified in this subparagraph for the calendar year should not exceed 1175 times the amount of the monthly calculation index established by the law on the republican budget and effective as of January 1 of the corresponding financial year. Individuals are recognized as SAP payers from the date on which such payment is made until the last day of the month for which SAP is paid.

 SAP is subject to payment in the total amount by depositing SAP by the payer in cash or by bank transfer through banks and organizations engaged in certain types of banking operations to the bank account of the State Corporation.

SAP size in 2022 is:

- 1 MCI or 3,063.00 tenge in cities of republican significance, the capital and regional significance;

- 0.5 MCI or 1,531.50 tenge in other settlements.