Why move to Frankfurt as an expat?
In these days of the globalization and the frequent movement of employees to various jobs in various countries, it is sometimes the case that someone does not live and work in Germany long enough to become vested in the German State Retirement Plan. A minimum of 60 months of contributions is required to become vested in the German retirement plan.
For many people, it is often possible to get a refund of their contributions to the pension plan.
It’s a process and there are the expected requirements, eligibility issues and application procedures with which to contend.
Who may be eligible?
- All non-EU/EEA citizens who have worked in Germany and contributed to the retirement plan for less than 60 months (5 years)
- Some non-EU/EEA citizens who have contributed less than 60 months (5 years) and whose home country has a social security agreement with Germany. (These countries include Albania, Australia, Bosnia-Herzegovina, Brazil, Canada / Quebec, Chile, India, Israel, Japan, Kosovo, Morocco, Macedonia, Montenegro, Philippines, Serbia, South Korea, Tunisia, Turkey, Uruguay, and the USA.) Additional conditions and rules may apply.
- Some non-EU/EEA citizens who have contributed more than 60 months (5 years) and whose home country does not have a social security agreement with Germany. Additional conditions and rules may apply.
- Those who have reached retirement age in Germany without having contributed 5 years or more to the retirement fund.
What are the requirements?
- An application for refund has to be submitted to the German State Retirement Insurance Fund (Deutsche Rentenversicherung)
- A non-EU/EEA citizen has to have not worked in Germany and/or made compulsory contributions to the retirement fund for a minimum of 24 months and must live outside Germany or any other EU/EEA country at the time of the application.
How much gets refunded?
- Compulsory contributions can be refunded to the full amount and voluntary contributions can be refunded up to 50 percent.
How long will it take after meeting the requirements and making the application before the refund is made?
- It can take from 2 to 6 months (or longer in some cases) to get the refund
- If you definitely plan on getting your pension contributions refunded after the waiting period, it makes sense to complete the application when leaving Germany or shortly before. It is usually simpler to collect all the proper documents while in-country as soon as possible rather than waiting for a few years. But, be sure not to submit the application until after the required waiting time.
- If you get a refund and eventually return to Germany to work, you’ll be starting your pension contributions from scratch and will not get any credit for prior years during which you may have contributed.
- You can get applications for refunds in English (and other languages) from the German Embassy/Consulate in your home country.
- While the refund payment can be made to a bank in most countries, it may be a good idea to maintain your German bank account if possible after leaving Germany and during the 2-year waiting period. This may speed up the payment a bit.
- Surviving dependents, spouses and legal civil partners are eligible for the refunds if the person who made the contributions dies before the 5 year qualifying or vesting period.
- If you choose not to get the refund and wait until full retirement age for the benefit it would be wise to see exactly how the German pension would fit in with any other national pensions you may be eligible for. You may be able to apply the years of contribution to a home country pension. This is especially important if you are a citizen of any of the countries with which the German government has a social security agreement.
- Help in the application process is available through the Deutsche Rentenversicherung or any number of companies and organizations that specialize in the refund process.