Much ink has been spilled about when a company pension may be paid and what tax rate it is subject to, but little has been written about how this works in practice. Do retired beneficiaries receive their money quickly and on time? A theme that occupies us very much since we usually are confronted with the problem cases because, as a rule, “no news is good news”.
Once you have reached retirement age, you are entitled to payment of the accrued pension benefits from the insurer, sector fund or pension fund. Since 1 January 2017, Sigedis has been handling for the employer the task of informing the pension institution when the statutory pension has been withdrawn. This of course is done digitally from the database of the Federal Pension Service via ‘periodic’ information flows (the timing still has to be defined by Royal Decree, but is usually weekly). Then the pension institution informs the person concerned about the amount, the method of payment and the documents required for payment. Once the pension institution has received all necessary information from the beneficiary, the amount owed must be paid out within 30 days.
Thus there is only 1 legal deadline: the flows of information from the pension institution to the beneficiary and then from the beneficiary to the pension institution are not subject to legally imposed deadlines. It should then come as no surprise that it is usually here that problems arise for late or even unpaid pension dossiers.
Research by the FSMA shows that the average turnaround time between the statutory pension and the payment of the supplementary pension amounts to 56 days for non-sectoral dossiers and 111 days for sectoral dossiers. The sectoral pension administrators receive their salary data quarterly via the social security network and not directly from the employer concerned, which extends the turnround time. Some sectors find a solution here by paying advances or by working with lump sums for their calculations and later settling any shortfalls.
The same research also shows that globally the payout period (after receipt of all necessary documents from the pensioner) is 10 days for non-sectoral dossiers and 34 days for sectoral dossiers! Important in this short processing time is the proactive attitude of insurers in informing the beneficiary in no less than 75% of the dossiers, something we can only applaud. We also advise beneficiaries to inform the pension institution themselves about their impending retirement so that all documents can be submitted in time for quick payment.
The “problem cases” are often the dossiers that do not follow the ‘standard flow’ of the pension institution, such as late notification of a statutory pension to Sigedis. This is aggravated by the limited digitisation of the process at some insurers. Finally, the beneficiary can also frequently be at fault due to submitting the requested documents late or not at all. In the latter cases, in our opinion, the pension institution can focus on better follow-up of the dossier and clearer communication to those involved.