OLD-AGE PENSION

The right to an old-age pension is acquired by an insured person who has reached 65 years of age, provided that he or she has completed 15 years of qualifying periods.

Insured persons – women in the period from 2014 to 2029 are entitled to an old-age pension at a lower age. In 2014, they could retire at the age of 61 (with the condition of 15 years of service), where the age requirement for each calendar year increased by 3 months until 2029.

By way of exception, raising the retirement age by 4 months every year was stipulated by the law that was in force from 1 January to 31 December 2019. However, the amendments to the law that enter into force on 1 January 2020 introduce a transitional period for women under more favourable conditions again. Raising of the retirement age is reduced from 4 to 3 months every year, with an exceptional raise by 2 months in 2020 in relation to 2019.

 

YEAR OF GRANTING THE PENSION RIGHTS PRESCRIBED AGE

– WOMEN –

years months
2014 61 0
2015 61 3
2016 61 6
2017 61 9
2018 62 0
2019 62 4
2020 62 6
2021 62 9
2022 63 0
2023 63 3
2024 63 6
2025 63 9
2026 64 0
2027 64 3
2028 64 6
2029 64 9

As of 1 January 2030, women and men can exercise the right to old-age pension benefit under the same conditions, having reached the age of 65 and 15 years of pensionable service, regardless of the gender of the insured person.

 

Early retirement pension

The right to an early retirement pension is acquired by an insured person who has reached 60 years of age and completed 35 years of qualifying periods.

In the transitional period from 2014 to 2029, women are entitled to an early old-age pension under more favourable conditions – at a lower age and lower pensionable service, so that from January 1, 2019, to December 31, 2028, the age and pensionable service are gradually increased by 3 months each year.

By way of exception, raising the retirement age and qualifying period by 4 months every year was stipulated by the law that was in force from 1 January to 31 December 2019. However, the amendments to the law that enter into force on 1 January 2020 introduce a transitional period for women under more favourable conditions again. Raising of the retirement age and qualifying period is reduced from 4 to 3 months every year, with an exceptional raise by 2 months in 2020 in relation to 2019.

 

EARLY RETIREMENT PENSION for women
YEAR AGE QUALIFYING PERIODS
2014 56 years 31 years
2015 56 years and 3 mjeseca 31 years and 3 months
2016 56 years and 6 months 31 years and 6 months
2017 56 years and 9 months 31 years and 9 months
2018 57 years 32 years
2019 57 years and 4 months 32 years and 4 months
2020 57 years and 6 months 32 years and 6 months
2021 57 years and 9 months 32 years and 9 months
2022 58 years 33 years
2023 58 years and 3 months 33 years and 3 months
2024 58 years and 6 months 33 years and 6 months
2025 58 years and 9 months 33 years and 9 months
2026 59 years 34 years
2027 59 years and 3 months 34 years and 3 months
2028 59 years and 6 months 34 years and 6 months
2029 59 years and 9 months 34 years and 9 months

 

The above conditions are in force until 31 December 2029. As of 1 January 2030, men and women acquire the right to early old-age pension benefit under the same conditions, having reached the age of 60 and 35 years of pensionable service, irrespective of the gender of the insured person.

The amount of the pension is permanently reduced for each calendar month prior to the realization of the entitlement up to the years of life of insured person prescribed for the acquisition of the right to an old-age pension, linearly by 0,2% for each month of early retirement, i.e. 2.4% per year to a maximum of 12% for a maximum of 5 years prior to retirement.

For beneficiaries who have qualified for pension benefit in the period from 1 January to 31 December 2019, using a reduction of the initial factor by 0.3% for every month of earlier retirement, of its own motion, the Croatian Institute for Pension Insurance will recalculate early old-age pension benefits as of 1 January 2020 with a new initial factor, or by a reduction by 0.2% for every month of earlier retirement, without adopting a decision.

An old-age pension for a long-term insured person (without deduction) is acquired by the insured person when they reach the age of 60 and 41 years of pensionable service in effective duration. Early retirement pension due to employer’s bankruptcy shall be acquired by an insured person who, following the termination of insurance due to bankruptcy immediately preceding the fulfilment of conditions for obtaining the right to pension, was registered continuously for at least two years as an unemployed person with the competent employment service.

The right to an old-age pension and early retirement pension is acquired by an insured person from the day on which all conditions for pension were fulfilled, whereby the right to pension may be realised after the termination of insurance. Exceptionally, an insured person who continued to work up to half of the full time on the basis of a modified contract, may obtain the right to an old-age pension without terminating the employment.

Overview of conditions for obtaining the right to pension

 

Minimum pension

Insured persons whose pension is determined on the basis of salaries or insurance bases lower than the so-called minimum pension, are entitled to a minimum pension. As of 1 July 2019, the minimum pension is calculated by multiplying every full year of pensionable service with the current pension amount on the day of calculating the pension, using an appropriate initial factor and pension factor, and may be calculated as old-age pension, early old-age pension, invalid pension and family pension.

 

Determination of pensions

The amount of pension is calculated by multiplying personal points, pension factor and the actual value of pension. The pension factor is determined by the type of pension to be realised, and the actual value of the pension is determined by the Governing Board of the Croatian Pension Insurance Institute (hereinafter: the Institute), based on the data of the Croatian Bureau of Statistics, no later than two months after the end of each half-year.

Personal points are calculated by multiplying the average value point with achieved qualifying periods and the initial factor. The initial factor affects the amount of pension in case of old-age pensions and early retirement pensions, so that:

  • An old-age pension increases for the insured who first acquires the right to a pension after completing the age requirement for the right to old-age pension and who has a pensionable service of 35 years by 0,34% for each month after the age prescribed for the acquisition of the right to old-age pension but for 5 years at the most,
  • An early old-age pension is reduced for the insured by 0,2% for each month of early retirement before the insured person meets the age requirement prescribed for the acquisition of the right to an old-age pension.

The average value point is calculated on the basis of salaries earned over the entire working life in relation to the average annual salary in the Republic of Croatia.

The salary earned in the year in which the pension entitlement is exercised is not used for the determination of value points when calculating the pension, but for that year the average value points are taken in proportion to the insurance period in that year.

With each pension, and based on the special act, a pension supplement is calculated and paid.

 

Indexation of pensions

By determining the actual value of pension, pensions are adjusted twice a year in relation to economic trends in the Republic of Croatia.

The AVM adjustment rate, applied starting from 1 January 2015, is determined by the variable ratio of the consumer price index and gross salaries of all employees in the Republic of Croatia in the previous year, compared to the year preceding it (70:30, 50: 50 or 30:70, whichever is preferred). From July 1, 2019, the pension is aligned as follows: from January 1 to July 1 each calendar year according to the 70:30 i.e. 30:70 model.

Pension payment

Pensions and retirement benefits are fixed in monthly instalments and paid retroactively for each previous month.

During the period of employment or self-employment, the payment of pension is suspended and the status of an insured person is established, and after a minimum of one year of insurance, a pension beneficiary may, under certain conditions, request re-determination of the pension, followed by a formal decision.

The following beneficiaries are exceptions:

  • Beneficiaries of an old-age pension who work up to half of the full time,
  • beneficiaries of pensions according to special regulations with work up to half full time or full time,
  • Old-age pension beneficiaries for a long-term insured person with work up to half of full-time,
  • Early old-age pension beneficiaries with work up to half of full-time,
  • Beneficiaries of a disability pension due to occupational disability to work (according to previous regulations),
  • Beneficiaries of a disability pension due to partial loss or working capacity,
  • Beneficiaries who perform seasonal jobs in agriculture under the regulations on incentives for employment and other regulations
  • Beneficiaries who receive other income or perform other activity.

 

The Institute may suspend the payment of pensions and other retirement benefits if a beneficiary does not submit any information or document requested by the Institute, which cannot be obtained by official means.

More info

 

Your right to an old-age pension pursuant to international agreements on social insurance

If you were insured in one or more countries with which the Republic of Croatia applies bilateral agreements on social insurance, the procedure for obtaining the right to pension is initiated by submitting an application to the pension insurance holder in the contracting state in which you have residence or in the contracting state of last insurance. If you have never been insured in your country of residence, your application will be forwarded to the contracting state of last insurance. An application submitted in one contracting state shall be deemed as an application submitted in all contracting states in which you have completed your insurance periods.

You will be entitled to pension in all contracting states in which you have been insured for at least twelve months, and if you satisfy other conditions under the national regulations of those states, for example, mandatory age condition.

All insurance periods that you have completed in other contracting states, if necessary, will be taken into account when you reach the necessary years of age for an old-age pension, and the amount of pension from each contracting state depends on the length of the period of insurance or residence in that state and national regulations of each contracting state.

1.6a. Application for determination of insurance periods completed abroad

Annexes to applications for granting the right to foreign pensions (to be completed with the application under no. 1.1) for:

– Swiss Confederation

– Australia

– Canada

 

Your old-age pension will be paid regardless of where you reside (in which contracting state).

More info

QUESTIONS AND ANSWERS

The procedure is initiated by submitting an application to the regional service / local office / branch office of the Croatian Pension Insurance Institute according to the permanent or temporary place of residence of the person submitting the application. If the applicant’s place of residence is located abroad, the regional service or office of the last insurance is competent.

In such a case, the right to a pension will be decided upon by the Institute on the territory where the last insurance was, then the request is forwarded to the competent Institute in the other contracting state on whose territory the insured person has completed insurance periods. The regional service or the office of the Institute where the last applicant’s insurance was is competent to decide on the right to a pension from the Croatian insurance.

An application for recognition of the right to an old-age and early old-age pension may be filed at the earliest one month before the fulfilment of the conditions for obtaining the pension rights prescribed by the Croatian legislation. However, it should be noted that this deadline is otherwise prescribed by the legislation of other Member States and that this period may be shorter or longer than the aforementioned.

In any case, when deciding on the right to retirement, the Croatian Pension Insurance Institute assesses the conditions for acquiring the right regardless of the date of filing the application in other countries.

According to the Pension Insurance Act, the right to a pension is realized after the termination of compulsory pension insurance. If an application is submitted within six months from the termination of insurance, the insured person is entitled to a pension from the first day of the following month after the termination of insurance. If more than six months has passed after the termination of insurance, the insured person has the right to a pension from the first day of the following month after the submission of the application, and for six months retroactively.

In order to ensure quicker procedure for obtaining the right to pension, the so-called pre-completion process may also be initiated at the Institute. Future pensioners are allowed to inform the Institute about their intention to go to old-age or early retirement twelve months before applying for a retirement pension, in order to obtain their right in a quicker way.

As the beneficiary of an old-age pension you can occasionally work based on employment contract, and this will not result in loss of your pension rights or termination of pension payment during such employment.  Thus, you can simultaneously receive your pension and work on the basis of an employment contract.

The Republic of Croatia has signed an agreement on social insurance with Bosnia and Herzegovina. Since you have completed 10 years of insurance in Bosnia and Herzegovina, and you will be entitled to an old-age pension in the Republic of Croatia after 2 years have passed (when you reach the age of 65), please contact the branch office of the Institute, according to your place of residence, and submit an application for a preliminary determination of your qualifying period completed in Bosnia and Herzegovina in order to obtain your pension rights as quickly as possible after you satisfy the prescribed conditions. The application form is available at regional offices and branch offices of the Institute and on the Institute’s web site.

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