In this article we describe the issues related to the procedures for payment of pension savings in accordance with the schedule, in connection with departure for permanent residence outside the Republic of Kazakhstan and in connection with the death of a person who has pension savings in the Unified Accumulative Pension Fund (UAPF). The answers to these questions will be of relevance to persons who have reached the age of retirement under the legislation of the Republic of Kazakhstan or who have taken up permanent residence outside the Republic of Kazakhstan, as well as to persons who are members of the family of a deceased person with pension savings in the UAPF or heirs to his/her pension savings.

According to the Social Code of the Republic of Kazakhstan (hereinafter - Social Code), pension savings are the money of a depositor of mandatory pension contributions (hereinafter - MPC), an individual for whom mandatory professional pension contributions (hereinafter - MPPC), voluntary pension contributions (hereinafter - VPC) are transferred (the recipient of pension payments) and which are credited to an individual pension account (hereinafter – IPA), including MPC, MPPC and VPC, investment income of pension assets, penalties and other income in accordance with contracts, the Social Code, the legislation of the Republic of Kazakhstan.

In accordance with subparagraph 3) of paragraph 2 of Article 35 of the Social Code, the UAPF is obliged to pay pensions to pensioners and (or) an authorized operator in accordance with the procedure established by the Government of the Republic of Kazakhstan. The specified procedure and requirements are determined by the Rules for the implementation of pension payments formed at the expense of mandatory pension contributions, mandatory professional pension contributions, one-time pension payments in order to improve housing conditions and (or) pay for treatment, formed at the expense of mandatory pension contributions from the Unified Accumulative Pension Fund, their return to the Unified Accumulative Pension Fund, approved by the Government Decree of the Republic of Kazakhstan as of June 30, 2023 No. 521.

The procedure for transferring pension payments, funeral lump sums to the recipients' bank accounts

Pension payments, a lump sum for funeral expenses are transferred by the UAPF to the bank account of the beneficiary or a member of the deceased's family who has pension savings, the details of which are specified in the application for pension payments.

The UAPF pays a lump sum to cover burial costs:

1) in the territory of the Republic of Kazakhstan to second–tier banks or organizations engaged in certain types of banking operations (hereinafter - STB), exclusively in the national currency of the Republic of Kazakhstan (KZT);

2) payments to foreign banks are made in the following types of currencies: in US dollars (USD), in euros (EURO), in pounds sterling (GBP), in Russian rubles (RUB).

Payment for banking services related to transfers, credits and payments of pension savings amounts at the expense of MPC, MPPC is carried out at the expense of the UAPF's own funds, with the exception of services for their conversion.

Please note that:

- in order to exclude refunds of pension payments, one-time funeral payments from STB and foreign banks, recipients of pension payments, heirs, family members of a deceased person with pension savings in the UAPF, it is necessary to clarify with the latter the relevance of the bank account (open or closed account), account type (current account, card account, special purpose account);

- pension payments and one-time funeral payments are not credited to special purpose accounts in the STB;

-payment of pension savings is made only to the bank account of the beneficiary (heir) himself/herself, even if the beneficiary, heir, family member of a deceased person with pension savings in the UAPF is a disabled or partially disabled adult. Payment of pension savings to the bank account of a legal representative (guardian or trustee), as well as an attorney is not allowed.

The frequency and terms of pension payments, one-time funeral payments

Pension payments from the UAPF are made:

MONTHLY:

• to persons who have reached the generally established retirement age, in accordance with the schedule of pension payments established by the State Corporation, but not earlier than the date of entitlement to pension payments from the UAPF (i.e. the date of reaching the general retirement age);
• to persons with disabilities of the first or second group, if the disability is determined to be permanent, according to the established schedule, within 10 working days from the date of receipt or submission of the documents to the UAPF.

AS THE LUMP-SUM:

• to persons who have left for permanent residence outside the Republic of Kazakhstan, within 10 working days from the date of acceptance of documents in the UAPF;

• in case of death of a person who has pension savings in the UAPF:
for burial – within 5 working days from the date of acceptance of documents in the UAPF; for
heirs – within 10 working days from the date of acceptance of documents in the UAPF.

Payments under the schedule

Pension payments from the UAPF at the expense of MPC, MPPC are provided to persons who have pension savings in the UAPF:

1) those who have reached retirement age: men - 63 years; women - 61 years before 1 January 2028; from 1 January 2028 - 61.5 years; from 1 January 2029 - 62 years; from 1 January 2030 - 62.5 years; from 1 January 2031 - 63 years;

2) with a disability of the first or second group, established indefinitely;

3) upon reaching the age of 55, if at the time of applying for the pension payment the MPPC has been paid for a total of at least 84 calendar months, subject to termination of employment in jobs with harmful working conditions, the professions of which are provided for in the list of productions, works, professions of employees approved by the authorized government agency (hereinafter - persons who have reached the age of 55 and for whom the MPPC has been paid for a total of at least 84 calendar months):

- as a lump sum at the expense of the MPC and/or the MPPC, with the exception of the persons referred to in paragraph 1-1) of Article 220 and subparagraph 2-1) of paragraph 1 of Article 221 of the Social Code, if the amount of pension savings at the date of payment from the UAPF does not exceed twelve times the minimum pension established by the law on the republican budget for the relevant financial year;

- in the form of monthly pension payments according to the established schedule in the manner determined by the Government of the Republic of Kazakhstan.

Detailed information on the procedure for the payment of pensions under the schedule, including the list of documents required, can be found on the UAPF website by the following link:

https://www.enpf.kz/kz/services/vyplaty/57494/

Pension payments at the expense of voluntary pension contributions

Pension payments at the expense of the VPC are made to persons who have pension savings in the UAPF:

1. persons who have reached the age of 50;
2. persons with disabilities;
3. foreigners and stateless persons who have left the Republic of Kazakhstan for permanent residence, unless otherwise provided by the laws of the Republic of Kazakhstan and international treaties ratified by the Republic of Kazakhstan.

The amount and frequency of the pension payments made at the expense of the VPC are determined independently by the recipient of the pension payments in accordance with the Pension Rules of the UAPF and the Rules for the implementation of pension payments formed at the expense of the VPC.

Detailed information on the procedure for the payment of pensions at the expense of the VPC, including the list of documents required, can be found on the UAPF website by the following link:

https://www.enpf.kz/kz/services/vyplaty/57498/

Pension payments in case of departure for permanent residence outside the Republic of Kazakhstan

Pension payments at the expense of MPC, MPPC and VPC are provided to foreigners and stateless persons with pension savings in the UAPF, who have left for permanent residence outside the Republic of Kazakhstan, unless otherwise provided by the laws of the Republic of Kazakhstan and international treaties ratified by the Republic of Kazakhstan.

Detailed information on the procedure for payment of pensions in connection with permanent residence outside the Republic of Kazakhstan can be found on the UAPF website by the following link: https://www.enpf.kz/kz/services/vyplaty/57496/

One-time funeral payment

In the event of the death of a person with pension savings in the UAPF, the members of the UAPF family will receive a one-time funeral payment from the deceased person's pension savings, equal to 94 times the monthly calculation index established for the corresponding financial year by the Law on the Republican Budget, but not exceeding the funds available in the deceased person's IPA.

If the balance of the deceased person's pension savings in the IPA, after the lump-sum funeral payment, does not exceed the minimum pension set by the law on the republican budget for the relevant financial year, this balance is paid as a funeral payment to the deceased person's family members.

Inheritance of a deceased person's pension savings

In case of death of a person who has pension savings at the expense of MPC and (or) MPPC and (or) VPC in the UAPF, these savings are inherited in accordance with the procedure established by the legislation of the Republic of Kazakhstan.

Detailed information on the procedure for making pension payments following the death of the person in whose name the UAPF account was opened can be found on the UAPF website by the following link:

https://www.enpf.kz/kz/services/vyplaty/57497/

Procedure for taxing pension payments, lump-sum funeral payments

Pension payments from the UAPF relate to income subject to individual income tax (hereinafter - IIT) at a rate of 10% under the Tax Code of the Republic of Kazakhstan. Personal income tax is withheld collectively for all types of pension payments formed at the expense of MPC, MPPC, VPC. 

Income in the form of a lump-sum payment for a funeral paid by a tax agent during a calendar year is excluded from the income of a taxpayer within the limit of 94 times the monthly calculation index established by the law on the republican budget and effective on January 1 of the corresponding financial year.

For detailed information on the procedure of pension payments taxation, follow the link to the UAPF website:

https://www.enpf.kz/kz/services/tax/57500/