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Your VBV pension plan

In the following video you will get a short overview of the pension fund system in Austria as well as contracts and contributions.

Approximately 25% of employees in Austria have a company pension plan and will get an occupational pension one day. We explain how your company pension plan works.

The Austrian pension system

In Austria, as in most other European countries, the pension system works on the so-called “three pillar model”.

The first pillar: state pension plan
The state pension plan is the most important one. The involvement of all gainfully employed people is obligatory. The working population finances the generation of retirees. Therefore, it is important that there are enough (or significantly more) employed people in proportion to the number of retired people. The state scheme ensures a good basic provision in old age.

The second pillar: occupational or collective pension plan
The occupational or collective pension plan is financed by the employer and supported by the state.

The third pillar: private or individual pension plan
The private or individual pension plan is adapted to specific individual requirements (such as savings, life insurance, investment funds etc.).

VBV is preferred partner for company pensions

One way to provide employees with a supplementary retirement is via pension funds which by law have to be joint stock companies. There are single- and multi-employer pension funds. The latter are not limited to any certain company and offer their services to interested employers.

VBV is one such multi-employer pension fund. VBV has become the preferred partner for employers to secure supplementary pensions for their employees as they offer higher longterm returns, more transparency and more investment rights than other products in this sector.

Things you should know about VBV-Pensionskasse

How does the VBV pension plan work?

The employer declares their intention to provide employees with pension benefits. A company agreement describes the pension benefit conditions. The employer then undertakes a pension fund contract with VBV-Pensionskasse according to that company agreement.

What is the Life cycle model?

A life cycle pension model is a specific form of a defined contribution pension fund scheme. If the employer implements such a pension plan, there are up to three different investment portfolios employees can choose before retirement.

The automatic life cycle pension model has defined age-limits where the switch into another portfolio – with less risk – is planned. In the classic life cycle pension model the employee decides when they want to switch theirinvestment portfolio.

Can you make additional contributions to the pension fund?

Yes, you can increase your VBV pension through employee’s contributions. You may contribute up to 1,000 Euro per year and benefit from a government-sponsored premium. The resulting pension is up to 100% tax free.

What can you do with your capital in case of termination of employment?

As soon as your employer informs us about the termination of your employment you will receive an information letter from VBV-Pensionskasse with further details about the handling of your capital. According to the legal guidelines, the payment of a lump sum is only possible under the following provisions:

  • The right to draw a lump sum may depend on the fulfilment of a certain period of contribution payment, which is stated in the pension agreement.
  • Your employment has to be terminated. We have to await the employer’s announcement of your employment termination.
  • The lump sum resulting from employer’s and employee’s contributions together must not exceed 15,900 Euro (value 2025). 
    The legal limit according to § 1(2) and (2a) PKG (Pensionskassengesetz) is upgraded regularly confirmed by law and according to specifically defined policy.
     
If the lump sum exceeds the legal limit you may request:
  • the conversion of the capital into a non-contributory qualifying entitlement;
  • the transfer of the capital to the pension fund, collective occupational insurance scheme, pension scheme according to § 5 (4) PKG or collective annuity insurance scheme of a new employer, or to an annuity insurance scheme with no entitlement to surrender;
  • the transfer of the capital to a foreign retirement pension model if you are changing your place of employment to abroad on a long-term basis or
  • the continuation of the scheme with your own contributions.

How do you get your VBV pension?

Usually, your employer informs us about your retirement and we will send you a letter with all details and forms we need to pay out your supplementary pension. If you do not retire from the employer who implemented the VBV pension plan for you, please contact us as soon as you receive the retirement notification from the state pension (ASVG-Bescheid).

Your initial pension will be calculated according to the contract conditions and depends on several factors, for exeample your capital, your age at retirement and the investment result.

Information in other languages

This is basic information about VBV-Pensionskasse in English. If you need more information in English or in other languages, you can use Google Translate, for example. We assume no liability for these translations.