The new Articles 33a and 33b of the Federal Law on Occupational Retirement, Survivors', and Disability Pension Plans (BVG/LPP) came into force on 1 January 2011. The two articles were adopted in the framework of the structural pension plan reform with a view to facilitating the participation of older employees in the labour market. Relying on these articles, pension institutions may now amend their regulations to allow employees between age 58 and the normal retirement age to maintain full benefits coverage (Article 33a BVG/LPP for continued coverage of the existing salary) up to and beyond the normal retirement age (Article 33b BVG/LPP for continued coverage up to age 70). This ensures pension plan participants greater flexibility in their retirement arrangements.
Withdrawals for home ownership only allowed up to normal retirement age
The fact that employees may go into retirement before they reach the normal retirement age or that they may continue working after that age has given rise to some uncertainty with regard to the rules on withdrawals for the encouragement of home ownership. The Federal Social Insurance Office (BSV/OFAS) has now clarified its position.
According to the BSV/OFAS, employees who wish to continue working and maintain their benefits coverage after reaching the normal retirement age may, pursuant to Article 30c(1) BVG/LPP, apply for a withdrawal to finance the purchase of their own home up to 3 years before the start of their entitlement to retirement benefits. According to a Federal Court decision, pension institutions may reduce or entirely eliminate the three-year limit in their regulations (see Federal Court ruling of 18 May 2004, i.S. CP X, 2A.509/2003). However, based on Articles 13(1) and 30c BVG/LPP and the aforesaid decision, persons who have reached the normal AHV/AVS retirement age may no longer make a withdrawal for home ownership because, once they reach that age, they have an entitlement to BVG/LPP retirement benefits.
Withdrawals cannot be repaid after normal retirement age
According to the BSV/OFAS, the same principle applies to repayments. Article 30d(3)(a) to (c) BVG/LPP provides that withdrawals for home ownership may be repaid up to three years before the start of the entitlement to retirement benefits, or until the occurrence of an insured event or until vested termination benefits are cashed in. Pension institutions may, however, reduce or eliminate the three-year time-limit. But once an employee reaches the normal AHV/AVS retirement age, withdrawals for home ownership may no longer be repaid.
The same rule for the self-employed
The same question applies to self-employed persons. The BSV/OFAS takes the view that Articles 33a and 33b apply by analogy to persons who are self-employed and who are insured on a voluntary basis with a registered pension plan. The rules on compulsory insurance coverage under Article 2(2) BVG/LPP apply mutatis mutandis to voluntary coverage for self-employeds. Articles 33a and 33b are also part of the rules on compulsory insurance coverage.