In this handy guide, we tackle how to get a German pension refund for expatriates who have lived and worked in the country.
16 September 2024
| Last updated on 23 September 2024
Wherever you are in the world right now – if you are reading this article, you most certainly have some kind of connection to Germany.
Have you been to Germany already? Are you planning on moving there soon? What are the pictures that come to your mind when thinking of Germany? Pretzel, Bratwurst, Oktoberfest? Punctuality, outspokenness, timbered houses?
Some of those pictures will be personal and hopefully joyful, and others quite unique. One that most of us will have in common is the feared ongoing, paper-loaded German... bureaucracy!
If you've already lived in Germany, you know how complicated and time-consuming it can be and how overwhelming and frustrating it can be to tackle complex bureaucratic tasks in a foreign language. If you're an expatriate moving to Germany – it‘s always good to be prepared.
Dealing with paperwork in Germany
This is where we step in: Germany Pension Refund offers help in dealing with the vast and complex pension refund Germany process by taking care of the dreaded paperwork for you, including the payment authorisation form and if you no longer hold a German bank account, help you get the funds in your local account, and other details for you to get your German pension refund!
Germany Pension Refund has over 15 years of experience in the field and specialises in helping expats with their pension refund from Germany. To give you an idea of what to expect, let’s have a look at the basics of the German pension scheme.
What is the German Pension Scheme?
If you are employed and working in Germany, you will pay 9.3% of your gross salary into the German pension scheme, which is part of the country's social security system.
Those contributions are used to finance the current pension payments of the retired population. Once you reach retirement age, your pension payments will be financed by the contributions of the younger, working generation.
The amount that you are contributing to the German pension scheme is automatically deducted from your salary, which is why many people neither are aware what institution they are contributing to, nor are they aware of the height of their contribution.
If you stay in Germany until retirement age, you will receive a monthly pension. But what happens if an expat leaves Germany before reaching retirement age? Let’s have a closer look.
Am I eligible for a pension refund from Germany?
Given that you have contributed to the German pension system during your time in Germany, you have a great chance of being eligible to get a refund of all your pension payments from the pension insurance before reaching the age of retirement, if you meet all of the three following requirements:
- You are a non-EU citizen.
- You live outside of the EU.
- 24 months have passed since your last German pension contribution.
Good to know: Only pension contributions paid by yourself can be refunded and no interest is applied. If pension contributions were made on your behalf, for example, while you received unemployment benefits from the German unemployment insurance, those contributions cannot be refunded.
If you have already received any benefits from the pension insurance, only contributions made after receiving those benefits can be refunded.
Contrary to the monthly installments that you would receive after reaching retirement age, the pension refund will be a lump-sum payment.
Specific requirements for your eligibility based on your citizenship
Due to social security agreements between Germany and the following countries, some additional rules apply depending on your citizenship.
USA, India, Australia, Canada, Albania, Moldova, The Philippines, South Korea, Brazil, Uruguay
If you are a citizen of one of the countries above, you qualify for a refund from your pension fund if you have contributed to the pension scheme for less than 60 months. Once you contribute for 60 months or more to the German pension insurance, you don’t qualify for a refund anymore, regardless of your age or your country of residence. If you don’t qualify for a refund of your pension insurance contributions, you can apply for a German retirement pension once you have reached retirement age.
Japan
If you originate from Japan and have moved back there, you also qualify for a pension refund from the German pension insurance, if your pension balance holds less than 60 months of contributions. If you contributed for 5 years and above, you can apply for a German retirement pension once you reach retirement age.
However, if you live abroad (outside of Japan) this limit does not apply. As a Japanese citizen living outside of Japan, you are eligible for a refund of your contributions regardless of the number of months of contribution.
Israel
Israeli citizens only qualify for a German pension refund if they live outside Israel. It does not matter how many months they have made contributions to the pension scheme in Germany.
How much will I get?
To find out exactly how much you might be eligible to receive, you can use the German pension refund calculator, which will give you a close estimate based on your German pension contribution and salary.
Let's have a look at some examples to understand the pension refund you might receive after you leave Germany:
If you had contributed for 24 months in 2021-2022 with a monthly gross pay of 6,000 Euros, your refund would be 13,392 Euros which you could claim starting from 2024, after 24 months have passed. That is a lot of money to leave behind.
If you had been working in West Germany and contributed for 12 months in 2022 with a monthly gross salary of 15.000 Euros, your refund would (only) be 7868 Euro, because in 2022 contribution was capped at 7050 monthly gross pay. The cap is adjusted annually, in 2024 at 7550 West and 7450 East Germany. Income above the cap is not subject to pension contribution.
Being unaware of the financial potential of a statutory pension insurance refund, a lot of expats leave this money behind when leaving Germany. The average pension return that Germany Pension Refund's customers received in 2024 is 11,800 Euro.
Good to know: Choosing Germany Pension Refund's service is financially risk free. Their success-based service fee only applies once your refund has been granted. No refund – no fees, no risk for clients!
