Pension for self employed

10 posts in this topic

Dear all, I registered as self employed in Dec 2016 and was without any income until 2018  (stayed with my bf until Dec 2018).

I was fully employed before 12.16. I did not make any money during the "freelancing" period. Now, I am paying my contributions again.

I did not contribute any money during these years.

 

Recently, I got few letters from DRV with V0023 and V0024 forms. Can I use the following rule and ask them to reduce my pension burden for these past years to zero? Can you please let give me suggestions how this could work? Any tips are welcome.

 

Halber Regelbeitrag

Eine weitere Ausnahme wird für frisch gebackene Existenzgründer gemacht. Sie dürfen sich bis zu drei Kalenderjahre nach Aufnahme der selbstständigen Tätigkeit für den halben Regelbeitrag entscheiden. Dann wird der Beitrag lediglich auf Grundlage der Hälfte der durchschnittlichen Bezugsgröße in Deutschland ermittelt. 

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So you're a mandatory member of German public pension insurance because of §2 SGB VI, e.g. since you are a teacher?

If not, you don't have to contribute to German public pension insurance at all as a self-employed.

 

So if you are a teacher:

Nope, that section you cited isn't advantageous to you, since it would mean paying for every month you were self-employed (§165 (1) Satz 2 SGB VI):

  • for 2017: 50% * 18.6% * Bezugsgröße = 9.35% * 2,975€ (Bezugsgröße for 2017) = 278.16€
  • for 2018: 50% * 18.6% * Bezugsgröße = 9.3% * 3,045€ (Bezugsgröße for 2018) = 283.19€

If you do have to pay, better to pay according to your real profit, which you say was 0€ - however, they do assume a minimum profit of 450€ a month according to §165 (1) Nr. 1 SGB VI, so you would have to pay for every month:

  • for 2017: 18.7% * 450€ = 84.15€
  • for 2018: 18.6% * 450€ = 83.70€

 

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10 hours ago, PandaMunich said:

So you're a mandatory member of German public pension insurance because of §2 SGB VI, e.g. since you are a teacher?

If not, you don't have to contribute to German public pension insurance at all as a self-employed.

 

So if you are a teacher:

Nope, that section you cited isn't advantageous to you, since it would mean paying for every month you were self-employed (§165 (1) Satz 2 SGB VI):

  • for 2017: 50% * 18.6% * Bezugsgröße = 9.35% * 2,975€ (Bezugsgröße for 2017) = 278.16€
  • for 2018: 50% * 18.6% * Bezugsgröße = 9.3% * 3,045€ (Bezugsgröße for 2018) = 283.19€

If you do have to pay, better to pay according to your real profit, which you say was 0€ - however, they do assume a minimum profit of 450€ a month according to §165 (1) Nr. 1 SGB VI, so you would have to pay for every month:

  • for 2017: 18.7% * 450€ = 84.15€
  • for 2018: 18.6% * 450€ = 83.70€

 

outstanding, dear @PandaMunich !  Great post!!!!

 

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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On 11/15/2019, 5:25:57, PandaMunich said:

So you're a mandatory member of German public pension insurance because of §2 SGB VI, e.g. since you are a teacher?

If not, you don't have to contribute to German public pension insurance at all as a self-employed.

 

So if you are a teacher:

Nope, that section you cited isn't advantageous to you, since it would mean paying for every month you were self-employed (§165 (1) Satz 2 SGB VI):

  • for 2017: 50% * 18.6% * Bezugsgröße = 9.35% * 2,975€ (Bezugsgröße for 2017) = 278.16€
  • for 2018: 50% * 18.6% * Bezugsgröße = 9.3% * 3,045€ (Bezugsgröße for 2018) = 283.19€

If you do have to pay, better to pay according to your real profit, which you say was 0€ - however, they do assume a minimum profit of 450€ a month according to §165 (1) Nr. 1 SGB VI, so you would have to pay for every month:

  • for 2017: 18.7% * 450€ = 84.15€
  • for 2018: 18.6% * 450€ = 83.70€

 

Awesome response thanks for that.

 

For the 84.15 EUR --> Not sure if I understood it right but can I pay "half of the minimum required for 3 years of setting up the business"?

Isn't there some law around it?

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4 hours ago, kapil354 said:

For the 84.15 EUR --> Not sure if I understood it right but can I pay "half of the minimum required for 3 years of setting up the business"?

 

No, you didn't understand it right, that section reads "half of the standard contribution (= Regelbeitrag) for the first 3 years after becoming self-employed".

The Regelbeitrag (= standard contribution) is:

  • public_pension_percentage * Bezugsgröße 
         which is in 2017: 18.7% * 2,975€ = 556.33€ per month
         which is in 2018: 18.6% * 3,045€ = 566.37€ per month

 

4 hours ago, kapil354 said:

Isn't there some law around it?

 

What I cited you was the law§165 (1) SGB VI which applies to all people like you (self-employed teacher) who fall under §2 SGB VI and who are therefore mandatory members of German public pension insurance.

 

This law offers you only 3 alternatives:

  1. §165 (1) Nr. 1 SGB VI: pay your public pension contribution according to your real monthly profit, but they assume a profit of 450€ a month even if your real profit is lower:
         for 2017: 18.7% * 450€ = 84.15€ per month
         for 2018: 18.6% * 450€ = 83.70€ per month
  2. §165 (1) Satz 2 Halbsatz 1 SGB VI: pay the Regelbeitrag, i.e. a public pension contribution based on an assumed monthly profit of the Bezugsgröße:
         for 2017: 18.7% * Bezugsgröße = 18.7% * 2,975€ (Bezugsgröße for 2017) = 556.33€ per month
         for 2018: 18.6% * Bezugsgröße = 18.6% * 3,045€ (Bezugsgröße for 2018) = 566.37€ per month
  3. §165 (1) Satz 2 Halbsatz 2 SGB VI: during the first three years after becoming self-employed, pay half the Regelbeitrag, i.e. a public pension contribution based on an assumed monthly profit of half of the Bezugsgröße:
         for 2017: 50% * 18.7% * Bezugsgröße = 18.7% * 1,487.50€ = 278.16€ per month
         for 2018: 50% * 18.6% * Bezugsgröße = 18.6% * 1,522.50€ = 283.19€ per month

You have no other choices.

 

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You are not a teacher, but a business consultant.

 

What I wrote applies to teachers, which is clearly stated in my replies:

 

On 14/11/2019, 22:25:57, PandaMunich said:

So you're a mandatory member of German public pension insurance because of §2 SGB VI, e.g. since you are a teacher?

If not, you don't have to contribute to German public pension insurance at all as a self-employed.

 

So if you are a teacher:

Nope, that section you cited isn't advantageous to you, since it would mean paying for every month you were self-employed (§165 (1) Satz 2 SGB VI):

  • for 2017: 50% * 18.6% * Bezugsgröße = 9.35% * 2,975€ (Bezugsgröße for 2017) = 278.16€
  • for 2018: 50% * 18.6% * Bezugsgröße = 9.3% * 3,045€ (Bezugsgröße for 2018) = 283.19€

If you do have to pay, better to pay according to your real profit, which you say was 0€ - however, they do assume a minimum profit of 450€ a month according to §165 (1) Nr. 1 SGB VI, so you would have to pay for every month:

  • for 2017: 18.7% * 450€ = 84.15€
  • for 2018: 18.6% * 450€ = 83.70€

 

 

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On 19.12.2019, 06:27:38, kapil354 said:

Hey @PandaMunich:)
I got this reply from pension deptt. 

 

pension delete.JPG

You are lucky that they consider you NOT to be a teacher but rather a consultant. There is a lot of definition-grey-zone in these areas and some people are then caught on the wrong side of it and have to pay into the pension like teachers and others don't

Count yourself truly blessed by this... and still don't forget to build up your own adequate provisions for pensions/retirement, right ?

 

Cheerio

 

I am a professional independent insurance broker, financial adviser, and authorised advertiser. Contact me.
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On 12/20/2019, 10:07:57, Starshollow said:

Count yourself truly blessed by this... and still don't forget to build up your own adequate provisions for pensions/retirement, right ?

 

Is there a cheap online way to build a private pension account in Germany withuot paying heaps of  money for agents/middlemen.

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