Canceling individual pension (BES), can be done at the request of workers. Employers enrolled their employees in the mandatory individual pension system, but employees are not obliged to remain in it. Workers who do not wish to stay in the system may request cancellation. To cancel after mandatory enrollment, you must submit your cancellation application within two months from the date the mandatory automatic enrollment begins. The withdrawal request from mandatory BES can be made to the insurance company that manages the mandatory system with a written petition or by completing an online form. The steps to complete the cancellation from the moment mandatory BES begins are as follows.
- When mandatory BES contributions start being deducted from the employee’s salary, the employee receives an information notice. This notice can be sent by SMS, email, fax, or post. From the date this notification is received, the employee has two months to opt out of mandatory BES. The employee submits the application within this two‑month period.
- The application must be submitted to the insurance company where the mandatory BES was established.
- The insurance company that receives the cancellation request will evaluate it within 10 days. If the request is approved, the amounts deducted from the employee’s salary under mandatory BES are returned to the bank account specified by the employee in the application, and the cancellation process is completed.
Vesting Rates for State Contribution in the Individual Pension System
The state contribution in the individual pension system increases the longer you remain in the plan. To be eligible for the state contribution, you must remain enrolled in the system for at least three years. If you cancel mandatory BES before three years, you will not receive the state contribution. The state contribution entitlement rates by years are as follows:
- If a person remains in the individual pension system for at least 3 years, they are entitled to 15% of the state contribution.
- If a person remains in the system for at least 6 years, they are entitled to 35% of the state contribution.
- If a person remains enrolled for at least 10 years, they are entitled to 60% of the state contribution.
- If the participant retires through the individual pension system, or dies or becomes disabled while still enrolled, they are entitled to 100% of the state contribution.
How to Retire with the Individual Pension System?
Retiring with the individual pension system differs from ordinary retirement. Retirement via the individual pension system is possible if you have been enrolled for 10 years and are at least 56 years old. After retiring through the system, you can choose to receive your savings as a monthly pension. Your pension company will advise you on available options and funds. Alternatively, you may request a lump-sum payment of your full vested amount. Once you inform your insurer that you want the full payout, they must deposit the money within 10 days.
How to Check Individual Pension via e‑Government (e‑Devlet)?
To find out the status of your individual pension and the amount of state contribution in your fund, you should check your records on e‑Devlet. Follow these steps:
- Log in to e‑Devlet with your Turkish ID number and password.
- From the Emeklilik Gözetim Merkezi (Pension Monitoring Center) applications, use the “Bireysel Emeklilik ve Otomatik Katılım Sistemlerinde Devlet Katkısı Sorgulama” service to view the status of your individual pension and state contributions.
Who Is Covered by the Mandatory Individual Pension System?
According to the official notices, the mandatory individual pension age is 45. All citizens under 45 are included in the mandatory system regardless of their sector. Both public sector employees and private sector workers under 45 fall within the scope of the mandatory individual pension system.
How Much Is Deducted from Salaries for the Individual Pension System?
Workers join the automatic mandatory individual pension system through their employers. The standard salary deduction rate for the system is 3%. If a participant wishes, they may request a higher deduction than 3%—there is no legal limit on increasing the contribution. For each month a participant remains in the system, the state contributes 25% of the participant’s contribution. Under current rules, the maximum monthly deduction that can be taken from salary for the scheme is 340 TL, and the minimum is 53 TL.
How Much Can You Earn from the Individual Pension System?
Under mandatory BES, a portion of participants’ salaries is deducted and placed into pension funds; participants can determine their contribution levels within the available framework. For example, with a 3% deduction, minimum wage earners will see a total of 640 TL deducted annually. However, with state contributions, minimum wage workers can receive a total benefit equal to three times the deductions—about 1,800 TL in the example. At initial enrollment, the state provides an immediate 1,000 TL contribution, and each month enrolled participants receive an additional state contribution that amounts to 25% of their contribution (for a monthly 50 TL deduction, this is 160 TL annually at 25%). In this scenario, a minimum wage earner who pays 50 TL per month would have roughly 2,800 TL accumulated after one year, including the initial and monthly state contributions. If the monthly deduction is 300 TL, a total of 3,600 TL would be deducted from salary over one year; with an initial 1,000 TL state contribution and an annual state contribution of 900 TL, that participant would have about 5,500 TL after one year. Summarizing:
- A minimum wage earner paying 53 TL monthly contributes 640 TL per year and, with state contributions, would have accumulated about 1,800 TL after one year. The net gain from the system in this example is 1,160 TL.
- A participant contributing 300 TL monthly (3,600 TL per year) would have about 5,500 TL after one year, yielding a net gain of 1,900 TL in this example.
How to Apply to the Individual Pension System?
Enrollment in the individual pension system is arranged by employers. When you start working at a workplace covered by the system and your social security registration is completed, you are automatically enrolled in BES. Employees do not submit the initial enrollment application themselves; they may, however, request cancellation. Cancellation must be done within two months from the start of the scheme for that employee.
How Is the Pension Company for an Individual Pension Chosen?
The individual pension contract must be signed by the employer with a pension company registered by the Ministry of Treasury and Finance.