Bill to boost workplace pension plans in Spain

Automatic summary, not yet reviewed

1. The bill would create open publicly promoted employment pension funds, promoted by the Ministry of Inclusion, Social Security and Migration through a Promotion and Monitoring Commission. Public promotion does not guarantee the value of contributions or their returns.
2. The funds would be managed by a managing entity with a depositary, under a single Special Control Commission of thirteen members appointed by the Promotion Commission. Managing and depositary entities would be chosen through an open procedure under public sector contracting law.
3. All managing and depositary entities would use a common digital platform serving companies, participants and beneficiaries, with information on their rights and transactions.
4. Investments would be made exclusively in the interest of participants, considering return, risk and social and environmental impact. Companies based in tax havens and companies convicted of environmental or labor crimes in the previous ten years would be excluded.
5. The bill would create simplified employment pension plans, promoted by companies under sector collective agreements, public administrations, self-employed associations, unions, professional associations or cooperatives. Their terms would be common to all entities in the plan.
6. The general limit for contributions with tax benefits would stay at 1,500 euros per year, but it could increase by up to 8,500 euros with employer contributions, or by 4,250 euros for contributions to simplified plans for self-employed workers.
7. Companies would get a 100% reduction in Social Security contributions for common contingencies derived from their contributions to employment plans, up to a maximum, and a 10% deduction in Corporate Income Taxincome tax The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings. for contributions for workers earning under 27,000 euros.
8. Existing associated pension plans would have five years to become simplified employment plans or individual plans; after that, they would remain as associated plans until they end, and no new ones could be created.

Who it affects

• Employees, who could access workplace pension plans, mainly through sector collective agreements.: They could save for retirement with employer contributions and higher tax limits.
• Self-employed workers.: They could contribute up to 4,250 additional euros to simplified plans and join sector plans without prior membership of an association.
• Companies contributing to employment plans.: They would get a reduction in Social Security contributions and a 10% deduction in Corporate Income Tax.
• Public employees.: The bill seeks to generalize employment plans for public workers, negotiated in general bargaining bodies.
• Insurance and reinsurance companies.: They would pay a fee for the review of internal models and specific parameters, and non-profit employment pension funds would be exempt from the Financial Transactions Tax.

Words worth knowing

Plan de pensiones de empleo

Retirement savings plan set up by a company or sector for its workers.

Partícipe

Person who contributes money to a pension plan and holds rights over it.

Aportación definida

Type of plan where what you contribute is defined, not the pension you will receive.

Derechos consolidados

Money already earned in the plan, which is yours even if you leave.

Convenio colectivo sectorial

Agreement setting working conditions for all companies in a sector.

income tax

The personal income tax (IRPF in Spain): what people pay on what they earn from work, business or savings.

It summarizes the text passed by the Senado. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries