Information for Employers

Companies pay a certain percentage of the gross salary or a specific fixed amount into BONUS Pensionskassen Aktiengesellschaft on behalf of all employees or selected groups of employees.

Up to 10% of the total gross wages and salaries of eligible participants may be paid into the pension fund tax-free. No social security contributions are due on these contributions. The contributions are thus paid into the pension plan on a gross-to-net basis.


For the employer, these contributions are tax-deductible as business expenses.

Key considerations include

• the contribution amount
• the level of survivor and disability benefits
• the retirement age
• Life-cycle model
• Waiting periods
• and much more are tailored to the employer’s needs and capabilities

Amount of the pension benefit

This is determined exclusively by the contributions paid in, minus insurance tax, administrative costs, and the risk premium, plus investment returns and actuarial results.

The following factors are relevant to the pension amount

• Age at retirement
• Amount of accumulated pension credits
• Amount of survivor’s benefits
• Amount of the disability pension
• Discount rate

The pension amount is adjusted annually and depends not only on the factors listed above but primarily on developments in the capital markets and the actuarial result. For the employer, payment of the agreed-upon pension fund contributions fulfills all obligations toward its employees and the pension fund.

If business has been particularly good, let your employees share in the success and save on taxes and payroll expenses at the same time.
  

What do you need to keep in mind?

The annual employer contribution is at least 2% of the gross annual compensation.
You can then make additional variable contributions up to a total contribution (annual employer contribution plus variable contribution) of 10% of the total gross wages and salaries. These variable contributions depend on financial metrics such as

• profit (before or after taxes)
• Revenue
• Return on equity
• Liquidity ratios
• Cash flow
• Productivity per Employee
• Cost Accounting Ratios
• Operating Profit

This can take into account the industry, size, and scope of the business.

• Companies that employ workers covered by the following collective bargaining agreements may offer their workforce the option of salary conversion: 

  • Employees in the IT industry
  • Employees in the construction industry
  • Employees in the woodworking industry
  • Workers in the wood processing industry
  • Employees in the sawmill industry
  • Workers in the sawmill industry
  • Workers in freight forwarding and warehousing companies
  • Employees in freight forwarding companies
  • Insurance industry

   The following points should be noted:

  • Employees who earn more than the minimum wage specified in the collective bargaining agreement may convert existing salary components.
  • Up to 10% of the annual gross salary may be allocated to a supplemental pension plan, tax-free and exempt from social security contributions, for the duration of the employment relationship. The salary must not fall below the minimum wage stipulated in the collective bargaining agreement.
  • This is also possible for employed family members and managing directors of a GmbH with a stake of up to 25%, provided they are subject to the collective bargaining agreement.
  • Each employee decides individually whether to contribute and how much to contribute.

The following individuals are eligible for pension coverage through the BONUS Pension Fund:

At the federal level: the President of the Republic, members of the Federal Government, members of the National Council

At the state level: Members of the state government, members of the state parliament

At the municipal level: Mayors 

In the City of Vienna: Members of the city government (mayors and the City Senate), members of the City Council, chairs of a City Council or municipal council caucus, district mayors, and their deputies

In statutory cities: mayors, deputy mayors, city council members 

How it works

Politicians subject to the Incompatibility Act receive a pension fund contribution equal to 10 percent of their gross salary. The pension fund contribution is transferred to the BONUS Pension Fund by the federal government, the state, or the city and is granted in addition to the gross salary.

All other politicians may submit a declaration in favor of a tax-exempt pension fund contribution during the first 3 months following the date of their swearing-in.

Once this declaration is submitted, one-eleventh of the monthly gross salary is converted into a tax-free pension fund contribution and transferred by the federal government, the state, or the city or municipality to the BONUS Pension Fund. 

The advantages of converting part of one’s salary into a pension fund contribution:

• Tax-exemption for the converted portion of their salary
• Receipt of a supplemental pension from the BONUS Pension Fund
• Greater financial independence for “the years ahead”
• Tax-free investment
• Lifetime pension benefits from the BONUS Pension Fund
• Entitlement to survivor benefits

The gross pension amount paid out for the first time upon retirement is guaranteed.
The pension can never fall below the amount of the initial payment. The pension is increased every 5 years in accordance with statutory requirements.

Who is eligible to choose the guaranteed pension?

Individuals eligible for benefits under a defined-contribution plan may opt into the Security, Investment, and Risk Community no earlier than upon reaching age 55.

The latest possible date is upon retirement. If you would like to learn more, please contact us directly.

Under the defined-benefit pension plan model, the future pension amount is set at a fixed level. The employee is promised a future benefit in a specific amount or as a specific percentage of their final salary.

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The pension amount is fixed. Based on this amount, the pension fund calculates the necessary contributions year by year. If investment returns fall short of expectations, contribution payments must be increased accordingly.

If the capital markets perform better than the rate of return assumed in the calculations, lower contributions must be paid into the pension fund in the following year. The amount of your contributions may vary.

These contributions are also deductible as business expenses and thus tax-free if the pension to be paid does not exceed 80% of the future retiree’s final salary. In total, the ASVG pension and the pension from the pension fund arrangement may not exceed the final salary prior to retirement.