How to set up an individual retirement account at the UPSF Printable versionLast update: 23.02.2023
On October 12, 2021, the President of the Republic of Kazakhstan signed the Law of the Republic of Kazakhstan "On Introduction of Amendments and Additions to Certain Legal Acts of the Republic of Kazakhstan on Social Protection of Certain Categories of Citizens" (hereinafter: the Law) under which the appropriate amendments were made, including the Law of the Republic of Kazakhstan "On Pension Provision in the Republic of Kazakhstan".
Pursuant to the amendments made, individual pension accounts (IPS) intended for mandatory occupational pension contributions (MOPC) at UPSF will be set up automatically upon receipt of the first installment beginning from October 26, 2021.
The UPSF information systems are configured for a new procedure to set up IPS for MOPC, which is similar to the set up of IPS at UPSF for other types of pension contributions.
The application-free procedure to set up an IPS is valid:
- from January 8, 2019 in respect of mandatory pension contributions;
- from May 1, 2021 in respect of voluntary pension contributions.
An identity of an individual for whom MOPC are transferred will be verified based on personal data (full name, IIN, date of birth) indicated in the electronic payment order for transfer of MOPC, while the other information, i.e. details of an ID document, place of permanent residence, etc., will be received by UPSF from the relevant information systems of government agencies.
An agent (payer) of MOPC is an employer who is obliged to deduct contributions out of own funds in favor of an employee in the amount of 5 percent from a monthly income accepted for calculating pension contributions under the procedure established by the Government of the Republic of Kazakhstan.
Citizens working at hazardous and dangerous fields of activity have the right for pension savings at the expense of MOPC. The list of such professions was approved by the Decree of the Government of the Republic of Kazakhstan "On approval of the List of industries, works, professions of employees in whose favor depositors of mandatory occupational pension contributions at their own expense make mandatory occupational pension contributions" as of December 31, 2013 No. 1562.
Legislative changes related to the automated set up of IPS for MOPC will significantly facilitate fulfillment of agents' obligations to transfer MOPC as there won`t be the need to draw up an application for the set up of IPS for MOPC together with an employee as well as to provide a package of documents containing more than 10 items to UPSF.
Mandatory occupational pension contributions are paid in the national currency of the Republic of Kazakhstan no later than the 25th date of a month following the month of income payment. An economic entities applying a special tax regime transfer MOPC under the procedure and terms provided for by the tax legislation of the Republic of Kazakhstan.
The tax authorities monitor the transfer of MOPC. If an employer fails to transfer an employee`s MOPC to IPS in a timely manner (under condition of the actual payment and receipt of income by an employee), then tax authorities collect MOPC along with an accrued penalty in the amount of 2.5 times the official refinancing rate established by an authorized body for each day of delay from an employer and transfer those to UAPF.