Foreign pensioners Cross-border workers have to pay contributions

New European directive: Frontier workers have to pay health insurance and long-term care insurance

27/10/2011

Those who receive pensions from abroad have to pay contributions to the health and long-term care insurance. The reason for this is an EU directive whose implementation the Bundestag has decided this year. The Siemens company health insurance provides an overview. The regulation affects so-called frontier workers. These are retirees who live in Germany, but have worked for years in neighboring countries and therefore receive a pension from there. It does not matter whether it is a Member State of the European Union or a third country.

With the introduction of the obligation to pay contributions, foreigners are treated as equivalent to domestic pensions. Half of the general contribution rate is used as the basis for calculating contributions from foreign pensions for health insurance. That is currently 7.3 percent. The reduced contribution rate ensures that the beneficiaries of a foreign pension will ultimately not be more heavily burdened than those who receive an equal domestic pension.

For employers, too, this regulation creates new obligations. If unemployment benefits are applied for abroad, German employers have to submit the necessary data to the Federal Agency for frontier workers who were employed before unemployment or earlier in the company. (Pm)