If a citizen decides to join the second pillar, he or she will enter into a retirement savings contract with the selected pension company, in which he / she chooses to maintain a savings strategy (type or types of funds) according to his / her tolerance. They will enter the second pillar only by registering a contract with the Central Register of Contracts (CRS). However, this does not stop his duties.
Employee and employer
After the conclusion of the contract, the employee must announce in writing to his employer (premium payer) the date on which he became a participant in the pension savings so that the employer can fulfill the obligations of the payer.
Employers who are payers Taxes on personal income from employment and functional benefits will thus automatically become the payers of pension savings premiums by law. The premium administrator (ie the locally competent tax administrator) learns this fact on the basis of the employer’s first electronic report. The employer always submits the report by the 20th day of the following month, when the advance payment for the specified advance period is also due. After the end of the calendar year, the employer (premium payer) submits premiums to three months, according to individual employees participating in the second pillar and a summary for the payer.
The CRS administrator starts to transfer the premium from the participant, ie his employer, to the pension company account from the date of registration of the new contract (ie on the first day of the calendar month following the entry into force of the registration decision).
If an employee changes employment, he / she notifies only his / her new employer that he / she is part of a retirement savings scheme . Neither the CRS Administrator nor the Pension Company notifies this information. The new employer, on the basis of the employee’s announcement, will reduce the pension insurance contributions and make a deduction from the retirement savings premium and make monthly reports and annual accounts.
Employer pension payment
Employers deduct premiums for their employees (retirement savings participants) at the aggregate amount of the relevant tax office on their account with the 41013 prefix and the variable symbol (the master part of the premium taxpayer ID). The premiums received will be transferred by the tax authorities to the respective pension companies of the participants on their retirement savings account.
Participation of self-employed persons in retirement savings
Self-employed persons (pension savings participants) do not pay the pension savings advance . The insurance period for pension savings is a calendar year. This self-employed person is obliged to submit an insurance return to the pension savings premium. This will be part of the self-employed tax return.
Self-employed persons do not have to submit their insurance returns only if their premium is CZK 0 or the employer pays the premium for it (self-employed without business income is also an employee).
However, self-employed persons in retirement savings may pay premiums up to the limit of CZK 100,000.00 to their local competent tax authority for a bank account with the prefix 31018 and a variable symbol (the core part of the tax savings participant’s pension number). From the premiums received, the tax authorities will transfer the participant’s pension company to the pension savings account for a maximum amount of CZK 100,000. The information about the real pension savings premium for 2013 will be included in the insurance return filed in 2014.
Persons without income or when they do not have to pay
By signing the retirement savings contract, the participant undertakes that, for the remainder of his gainful employment until the retirement pension from the basic pension scheme (first pillar), part of his premium (3 percentage points) will be paid to his individual pension company account. At the same time agrees that after that period will pay a higher premium rate, by an additional 2 percentage points, which will also be transferred to his personal account at retirement Good Finance will happen when the participant loses income and no insurance will it not be diverted to the first pillar ?
This situation can happen if a citizen loses his job, is on maternity or parental leave or is ill for a long time. In this case, he has no income and is usually dependent on income from the state. If a citizen does not receive income from which the first pillar is paid, there is no payment to the second pillar. However, the citizen continues to be a participant in the retirement savings scheme (second pillar); If the income from which the premium is paid out again, the payments will be renewed. Therefore, a simple lawyer pays: Payment to the second pillar (pension savings) copies the payment to the first pillar (compulsory pension insurance).