Many mothers and fathers limit their gainful employment in order to devote themselves to caring for and raising their children.
Child-raising periods in pension insurance
Insurance periods are not only periods during which contributions were paid (contribution periods); periods of child rearing are also considered insurance months. Child-raising periods are credited per child to the parent who actually and predominantly raised the child. In pension insurance, up to four years (48 months per child, 60 months for multiple births) are credited as child-raising periods. This regulation avoids gaps in the insurance history and increases the later pension entitlement. A monthly contribution base of 1,986.04 euros (2021) is used for periods of child-rearing and credited to the personal pension account. This value is adjusted (increased) annually.
Children are natural children, stepchildren, adopted children and foster children.
If child-raising periods overlap due to the birth of another child, the child-raising period for the first child ends when the child-raising period for the second child begins.
If the child-raising period is spent in gainful employment, this period is taken into account as a single insurance period. However, the contribution base determined for the child-raising period is added to the later pension amount.
Voluntary pension splitting
Since 2005, there has been the option of voluntary pension splitting. This allows the parent who does not devote most of his or her time to raising children and is employed to have up to 50 percent of the pension account credit transferred to the pension account of the parent who devotes most of his or her time to raising children for the first seven years.
Such a transfer can be requested from the competent pension insurance institution until the youngest child reaches the age of ten. Pension splitting was introduced to compensate, on a voluntary basis, for the loss resulting from the child-raising period by limiting gainful employment on the pension account between parents.
How much can be transferred?
The amount of carryover can be decided for each individual year.
The following legal limits must be observed:
Only credits from gainful employment can be transferred. Credits from insurance coverage due to unemployment, receipt of sickness, weekly or transitional benefits, military or civilian service, child rearing or voluntary insurance cannot be transferred.
In any calendar year, no more than 50 percent of the credit may be carried over from employment.
Only enough can be transferred so that the maximum annual contribution base is not exceeded in the pension account of the parent taking over.
The transfer may be made as an amount or as a percentage of the credit. The allowable amount is calculated by the competent pension insurance institution.
Transfers are possible for a maximum of 14 calendar years.
What to do to transfer a credit?
The transfer must be applied for at the latest by the tenth birthday of the youngest child at the competent pension insurance institution (this is the institution with which the parent who is predominantly gainfully employed is insured for pension).
Before the transfer, the insurance periods and credits for the calendar years concerned must be final. The income tax assessment must be awaited. This mainly concerns self-employed persons.
For the time being, you can informally apply for the transfer and submit the agreement on the amount later, when all necessary data are available. Furthermore, an agreement on the transfer must be concluded with the other parent.
A transfer is no longer possible if one of the parents is already entitled to an own pension (old-age pension, early old-age pension, corridor pension, heavy work pension, disability/occupational disability/disability pension) or a retirement pension as a civil servant.
An agreement made is irrevocable as soon as the transfer has been carried out and the notice of this has been served. The transfer cannot be subsequently reduced or revoked. Forms for applying for the "transfer of child-raising periods" can be obtained from the competent pension insurance institution.
(Quelle Sozialministerium)
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