Germany Pension Refunds – Blog

  • Johannes@Germanypensionrefund

Contracting States, Nationalities and How YOU Become Eligible for a Refund.

Updated: Sep 19


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Having worked in Germany you might ask yourself if getting a pension refund is related to your nationality. It actually is in a way – though not as a no-go criteria, as many people misunderstand – depending on the mutual social security agreements your country has with Germany. What makes your nationality important in this equation is the combination of your nationality and where you reside at the moment you apply for a refund.



Germany has bilateral social security agreements with EU-member states, members of the EEA (European Economic Area), Switzerland, the UK and 23 non-European countries as follows:





European Union Member States:

Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.


European Economic Area:

Iceland, Liechtenstein, Norway


Switzerland


Non-European Contracting States:

Albania, Australia, Bosnia Herzegovina, Brazil, Canada/Quebec, Chile, China (only posting employees), India, Israel, Japan, Kosovo, Macedonia, Moldova, Montenegro, Morocco, Philippines, Serbia, South Korea, Tunisia, Turkey, United Kingdom (after Brexit), Uruguay, United States of America and soon: Ukraine


If you currently reside in one of the above mentioned countries you are covered by social security agreements. Find out if you are eligible or how you can become eligible for a refund in this article.


LEGAL DEFINITION OF ELIGIBILITY FOR A REFUND


The German Social Security Law defines who is eligible for a refund, and who is not. There are two main criteria and – you will be surprised – both of them have nothing to do with either your nationality or the amount of time (more or less than 5 years) you worked in Germany and paid contributions into the German statutory pension scheme.


First criteria: You cannot get a refund, if you are obliged to pay contributions into the Germany pension scheme.


This is the case, as long as you live and work inside Germany. Contributions are mandatory and will be paid automatically by your employer, after they were taken out of your paycheck.


Second criteria: You cannot get a refund, if you are given the option to pay voluntary contributions into the German statutory pension scheme.


This is the case, as long as you reside in one of the above mentioned countries. The German Pension Office allows you to keep paying contributions adding to your pension savings, even though you are not obliged to do so (because you live and work in a different country.) For some people that is helpful, e.g. if they consider moving back to Germany after a short period abroad, and plan to retire there. They might want to keep their pension amount growing and avoid payment gaps that will reduce the total of the monthly installments that will be paid to you reaching the German age of retirement (67).


These two criteria define who is not able to apply for a refund.

Everybody (nationality and contribution time are irrelevant) who is NOT OBLIGED TO PAY CONTRIBUTIONS and NOT GIVEN THE OPTION TO PAY VOLUNTARY CONTRIBUTIONS is eligible for a refund.


The reason is quite simple. Pension installments are supposed to guarantee your lifestyle when you are old and serve as a common sense reward for a lifetime spent working. If you have qualified for receiving German pension installments in the future but paying into the system for 5+ years only, your retirement payments will be extremely small. So, you are given the opportunity to grow them voluntarily to an amount that allows you to live on. But once you reside in a country that is not part of the bilateral system, you cannot get any benefits from the German Pension Office and more importantly, you are no longer given the right, to pay into your pension account voluntarily. So it is just fair to pay this money back to you, in order to grow a reasonable pension somewhere else in the world.

”You CAN get a refund, if you are no longer obliged to pay contributions, nor given the option to pay voluntary contributions to the German pension scheme”

Now we will check step by step if you are eligible for a refund based on the legal requirements and if you are not – we will show you under what circumstances you will become eligible:


EUROPEANS


1) If you are a national of a European member state, your German pension contributions can later on be merged with the contributions you pay in the country you currently reside. (Note: this requires your action!).


Legal check:

You are not obliged to pay contributions into the German system at the time being, but you are given the option to pay voluntary contributions worldwide: you are not eligible for a refund.



2) Your German Pension contributions will ”wait” for you in Germany. You will get pension installments when you reach the German retirement age (67), if you have contributed to the German Pension scheme for at least 60 months / 5 years, which qualifies for future pension installments. If you have worked for less than 5 years, you can apply to get your contributions paid back to you (without interest) at the age of retirement.


Legal check:

You are not obliged to pay contributions into the German system anymore, but

you are given the right of voluntary contributions: not eligible for a refund.



3) If you reside in a non-contracting state (every state in the world, that is not mentioned above) and you hold dual citizenship – it is worth trying to get a refund.



Legal check:

If you are not obliged to pay contributions into the German system, AND

you are NOT given the right to pay voluntary insurance contributions: YOU QUALIFY FOR A REFUND!


”Europeans CANNOT get a German pension refund unless you are holding dual citizenship, and reside in a NON-CONTRACTING-STATE.”


CONTRACT-STATE NATIONALS (NON-EUROPEAN)


1) If you are a national of a Non-European contract state, and you reside in a European country, your German pension contributions can be merged with the contributions of that European state if you apply for that.


Legal check:

You are not obliged to pay contributions into the German system anymore, but

you are given the right of voluntary contributions: not eligible for a refund.



2) If you return to your home country or reside anywhere outside the EU/EEA/CH/UK, and the social security agreement between your home country and Germany does not allow you to pay voluntary contributions where you currently reside, you can get a refund of your contributions after the 24 months mandatory waiting period.


Legal check:

You are not obliged to pay contributions into the German system anymore, and

not given the option of voluntary contributions: eligible for a refund.




NON-CONTRACTING STATE NATIONALS


1) If you are a national of a non-contracting state, and you reside in a European country</