Private Pension System (PPS) and Employer Group Pension Plan (EGPP) are savings systems complementary to the current social security system with an intent to provide additional income to employers and employees during their retirement days to maintain their standards of life.
The pension plans offered for the institutions wishing to pay contribution for their employees have more attractive and desirable conditions than those offered for individual participants. Based on some criteria such as the number of employees and participants within the group, total net asset value of the fund etc., it offers some special advantages such as low administrative fee and entrance fee deductions etc.
While PPS provides additional income to employees in their retirement days, the employer who pays premium for his/her employees increases the motivation and loyalty to the company of his/her employees. Furthermore, the employer can write off and deduct the premiums paid for the employees from corporation tax base up to 15% of the monthly gross wage and up to annual gross minimum wage amount of each employee.
“Vesting Period” refers the period of time in which the employees joined the Private Pension System with corporation contribution are required to work for that corporation to be entitled to receive the contributions paid by the relevant employer for them. This period cannot exceed 7 years following the participant’s signature date of the group pension contract.
Interest-Free Pension Investment Funds:
Your savings are evaluated by Katılım Emeklilik in financial instruments in compliance with interest free personal pension principles. These instruments are gold, foreign exchange, lease certificates, participation account and stock certificates.
Advantages of Employer Group Pension Plans:
- It helps to keep qualified employees.
- It increases the motivation and loyalty to the company of the employees.
- It decreases the employee’s concerns for the future.
- It can be used as a rewarding tool.