The Pension Landscape Poland


In 1999, the state pension system in Poland was radically reformed. Within the new regime, benefits are strictly linked to the contributions paid in order to secure the sustainability of pensions. Alongside the pay-as-you-go financed state pension provision, a capital-funded component was introduced, the so-called Open Pension Funds (OFE = named as second pillar). Initially, the component was mandatory but in 2013, another reform, besides increasing the retirement age, strongly changed the position of the OFEs. Since the reform participation is no longer obligatory, the employee has to declare his explicit wish to contribute into an OFE system.

Statutory Pension

Social Security Institution (ZUS) and Open Pension Funds (OPF)
  Provision: The statutory pension provision is obligatory for employees and self employed persons. The system consists of two components: the Social Insurance managed by ZUS and the Open Pension Funds which are private institutions.
Social Security Fund managed by ZUS
Open Pension Funds
  Financing: Financed on a pay-as-you-go basis through the mechanism of a notionally defined-contribution accounts. Fully funded
Total contribution 19,52 % (2014) of taxable income to the old-age pension insurance (the employer pays 9.76 % and the employee pays 9.76%).

The insured has not registered with an Open Pension Fund:
  • 12,22 to ZUS
  • 7.3 % to the sub-account with ZUS
The insured is a member of an Open Pension Fund:
  • 12.22 % to ZUS
  • 2,38% to the sub-account with ZUS
The insured is a member of an Open Pension Fund:
  • 2.92% is transferred by ZUS.
Covers old-age, disability and death Covers old-age, disability and death
  Formula: Universal old-age pension: from the Social Insurance Fund and life funded old-age pensions from the Open Pension Funds starting in 2014 for men and women having reached legal retirement age.
Old-age pension = Indexed contributionsaverage life expectancy at retirement age in months

Occupational Pension

Occupational pension schemes were introduced in 1999 but are not very widespread. Only approx. 2% of workforce covered by Employee Pension Programs (PPE).
Non-obligatory by law
The plan must be offered to more than 50% of the employees in the company.
  Tax incentives: Employee contributions are based on after-tax earnings. Benefits are exempted capital gains tax.

Private Pension Savings

Products: Individual Retirement Accounts (IKE) and Individual Pension Security Accounts (IKZE) available as life insurance, mutual investment fund, brokerage account, (special) bank account or voluntary pension fund (only IKZE).

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