LOGIN or JOIN
information for global expats



Pensions for Expats in Russia

Submitted: December 2013

Russia’s pension system is based on social insurance, rather than tax-financing. It is also possible to save privately or through non-state pension funds.

Non-contributory benefits are also paid out to the most vulnerable social groups, including senior Russian citizens without enough social insurance contributions.

Social insurance

Any employer must make contributions towards social insurance, which includes pension saving. Employees need not contribute. The self-employed are also subject to social insurance legislation, but they have to pay on a flat-rate basis (currently US$ 49 per month).

Pension contributions are mandatory, regardless of nationality, even if you are on a temporary visa.  However, some foreign workers are not subject to pension contributions and therefore do not qualify for pension benefits. These include most notably:

  • foreign workers whose contract does not exceed six months
  • expats on a highly skilled worker visa.

Generally, employers must pay 34% of gross salary below a specified threshold, which is currently around US$18,000 per year.

Pension benefits

Currently, the pension age in the contributory system is 55 for women and 60 for men.

Retirement benefits are a major problem for the Russian Government, as they are becoming an ever larger burden on public finances. Nonetheless, the Government has so far refused to raise the pension age until 2018.

As a rule, you need at least five years of contributions before you can get any pension benefit, unless a social security agreement between Russia and your home country applies.

International matters

Social security agreements

Russia may have entered into a social security agreement with your home country. These agreements are primarily designed to avoid discrimination and double social security coverage. In addition, they may “totalise” your periods of contributions in Russia and in your home country. This is particularly helpful if you are expected by either country to have contributed for a long time (e.g. you must have contributed for 40 years to avoid a pension rebate).

It is quite uncommon for the Russian Government to conclude such agreements, except with countries that are politically very close to Russia.

International superannuation planning

In many countries, private superannuation schemes are tax-efficient products. Thus, they are heavily regulated in order to avoid undue tax base erosion. Thus, you should check:

  • how your overseas pension payouts are taxed whilst you are in Russia (there is potential for double taxation if your previous pension contributions were not deductible in your home country), and
  • how your pension pot may be taxed in your future countries of residence.

Your home country may have a tax treaty with Russia to avoid double taxation on your foreign pensions. As a general rule, pension payouts are only taxable in your country of residence. That said, you should check your tax treaty to make sure you don’t fall under an exception.

Retaining your foreign pension arrangements may be the most practical option if you don’t intend to stay in Russia. Nevertheless, cross-border superannuation planning is always on a case-by-case basis. It is strongly recommended to seek professional advice regarding this matter.

 

Contribute

We value input from our readers. If you spot an error on this page or have any suggestions, please let us know.

 

Moving to Russia

If you are considering moving to Russia or are soon to depart, you can find helpful information and advice in the Expat Briefing dedicated Russian section including; details of immigration and visas, Russian forums, Russian event listings and service providers in Russia.

picture1 Read More

Living in Russia

From your safety to shoppingliving in Russia can yield great benefits as well as occasional drawbacks.  Find your feet and stay abreast of the latest developments affecting expats in Russia with relevant news and up-to-date information.

picture1 Read More

Working in Russia

Working in Russia can be rewarding as well as stressful, if you don't plan ahead and fulfill any legal requirements. Find out about visas and passports, owning and operating a company in Russia, and general Russian culture of the labour market.

picture1 Read More

Russian Expat News Headlines

More

Russian Expat Service Providers

Expatriate Healthcare Experts in Moving
More

Russian Expat Tools






More Tools


 
 
 
 

Information

About | Useful Links | Global Media Partners | Media | Advertising And Sales | Banners And Widgets | Glossary | RSS | Privacy & Cookies | Terms And Conditions | Editorial Policy | Refer To A Friend | Newsletters | Contact | Site Map

Important Notice: Wolters Kluwer TAA Limited has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments. © Wolters Kluwer TAA Ltd 2017. All rights reserved.

The Expat Briefing brand is owned and operated by Wolters Kluwer TAA Limited.