Impact of PPK on employed persons – part I
The majority of employed employees will join the PPK automatically, and only their resignation from the PPK will take place upon request.
The diverse situation of employees:
Possibility of cancelling contributions to PPK:
- articipation in the PPK is voluntary,
- the participant resigns from making contributions to PPK by submitting a written declaration to the employing entity including a statement on knowledge of the consequences of submitting the declaration (opt-out declaration),
- the template of the declaration of resignation from making payments for PPK was set out in the Regulation of the Minister of Finance of 12/06/2019.
Using accumulated funds before the age of 60
A refund request before the age of 60 can be made at the request of an employee and will have the following consequences:
The PPK Act distinguishes two special situations in which it will be possible for an employed person to use the funds accumulated on the PPK account before the age of 60, without restrictions provided for using these funds:
Using accumulated funds after the age of 60
After the employed person reaches the age of 60, the ability of the employed person to collect funds accumulated on his PPK account is updated.
The mere fact that employed person reaches the age of 60 does not terminate the obligation to make payments to the PPK account:
- withdrawals from the PPK account are made at the request of an employed person, submitted to the financial institution maintaining the account,
- only after the employer receives information about the start of the withdrawal of funds from the employed person’s PPK account, the employing entity will be released from the obligation to transfer payments to the employed person’s PPK account,
- the financial institution must inform the employing entity that the employed person has submitted an application for payment of funds from the PPK account within 3 days from submitting such an application.
The PPK Act provides for a solution for withdrawing funds from the PPK account, which is free of additional fees, including taxes:
The PPK Act does not prohibit a one-off payment of all funds accumulated on the PPK account or a one-off payment in a higher amount than the statutory 25%. The payment of these funds in a different amount than provided for in the PPK Act will, however, be connected with the need to pay a tax.
In the coming weeks, more articles on PPK will appear – we encourage you to follow the Law Firm’s news on a regular basis. If you have any questions or concerns regarding the implementation of PPK, please contact our Law Firm.