Increased contributions to bridging pensions and to the so-called "Canada dry bridging pensions" in force as from 1 April 2010
In earlier Newsflashes, we informed you about the increased employer contributions to bridging pensions and to the supplementary allowances paid on top of some social security benefits and incapacity benefits, foreseen in the Programme Act of 23 December 2009 and in the Diverse Provisions Act of 30 December 2009.
By means of a Royal Decree, published yesterday in the Official Gazette, these increased contributions take effect as from 1 April 2010. In practical terms, it means that the following contributions are due:
1. Employers’ contributions on current bridging pensions
For the current bridging pensions, the degressive percentages, that were already determined in the Act of 27 December 2006, enter into force.
|
Age in the month in which the bridging pension allowance is paid |
Contribution (% of the supplementary allowances) |
|
Younger than 52 |
30% |
|
52 - 54 years |
24% |
|
55 – 57 years |
18% |
|
58 – 59 years |
12% |
|
60 years and older |
6% |
2. Employers’ contributions to current “Canada dry bridging pensions” and supplements paid on top of time credit allowances
A special employer’s contribution of 32.25% is due on the supplementary allowances that are paid in the framework of a current pseudo bridging pension. This contribution is only due as from the month in which the employee reaches the age of 50.
3. Employers’ contributions to new bridging pensions and “Canada dry bridging pensions”
For the (Canada dry) bridging pensioners whose notice or termination of the employment contract was notified after 15 October 2009 and whose (Canada dry) bridging pension starts at the earliest on 1 April 2010, contributions will be due in function of the entry age:
|
Entry age |
Contribution (% of the supplementary allowances) |
|
Younger than 52 |
50% |
|
52 - 54 years |
40% |
|
55 – 57 years |
30% |
|
58 – 59 years |
20% |
|
60 years and older |
10% |
Here also the contributions on supplementary allowances paid in the framework of Canada dry bridging pension are only due as from the month in which the employee reaches the age of 50.
4. Employees’ contributions
On current as well as on new (Canada dry) bridging pensions and supplements on top of time credit allowances, the employer must withhold 6,5% and pay this to the National Social Security Office.
In the Royal Decree published yesterday, somewhat lower contributions are foreseen for companies recognized as a company in restructuring or in difficulties. Moreover, the increased contributions do not apply to companies that have notified an intention to proceed to a collective dismissal or that was recognized as company in restructuring or in difficulties before 15 October 2009.
The Royal Decree also foresees an exemption from contributions in case of a resumption of work at another employer and in an increase in the contributions to (Canada dry) bridging pensions if no continued payment is foreseen in case of a resumption of work.