From 2025 personal income tax relief for savings in Tier III pension funds and investment life insurance contracts will cease to be valid, they will be replaced by an investment account. However, in the advertisements of Luminor, SEB and Swedbank, it is proposed to enter into accumulation contracts until 2024. on December 31, emphasizing that such a step would provide an opportunity to use the aforementioned benefit for another ten years, the Bank of Lithuania said in a press release.
In the opinion of the Bank of Lithuania, the information presented in this form raises doubts about its compliance with the requirements of legal acts and forms a negative practice – it gives the impression that the main object of the advertisement is not a financial product that meets the interests of the consumer, but a personal income tax benefit.
As a result, the Bank of Lithuania demanded that the Association of Investment and Pension Funds of Lithuania submit detailed and motivated explanations and supporting evidence regarding the compliance of the aforementioned advertisement with the requirements of legal acts.
Once the answers are received, the next steps will be decided.
Urged to “get back up to 3,000 euros”
15min already wrote about the fact that after the Seimas adopted a decision to cancel the personal income tax relief for contracts, pension tier III and investment life insurance contracts signed after 2025. January 1
After deciding to cancel the benefit, one reservation was left – if the contract is signed before December 31, this benefit will be available for at least another decade and during that time up to 3,000 euros can be recovered.
This is also used by financial institutions – both in the media and in the communication of the banks and other institutions themselves, there have already been calls to sign such an agreement without delay.
The Bank of Lithuania indicates that it has not noticed a significant increase in the number of contracts.
“Evaluating specifically the number of pension fund participants in the III pension tier, we do not notice significant changes in the number of participants. Growth rates remain similar to last year,” – 15min said Vaidas Cibas, Director of the Financial Market Supervision Department of the Bank of Lithuania.
However, the banks themselves claim to have felt greater interest from customers.
Here is the representative of Šiauliai bankas, Dalia Kolmatsui 15min said that this financial institution today feels the interest of customers and potential customers after the decision of the Seimas to cancel the GPM relief, however, he did not specify what the specific increase is.
Meanwhile, Loreta Načajienė, the manager of Luminor investment management, revealed that the number of newly signed contracts has increased by about thirty percent from the usual level since June.
This could be due to the proactiveness of the company itself.
“We think that the duty of Luminor investment management as a pension fund management company is to take care of the financial well-being of clients and educate the public on pension accumulation issues. From previous reforms, we have examples of the damage that insufficient communication can cause, so we inform both existing and potential customers about the change approved by the law”, L. Načajienė points out.
BNS photo/Swedbank, Luminor and SEB banks
June 14 Luminor issued a press release entitled “Don’t miss the chance: it will still be possible to recover up to 3 thousand from the state. euros”, in which they advertised Tier III funds. Both this and similar advertisements of “Swedbank” and “SEB” did not escape the eyes of the Bank of Lithuania.
According to V. Cibo, such communication may not meet the requirements of legal acts.
“Requirements for the advertising of third-tier pension funds are established in Article 14 of the Law on Additional Voluntary Pension Accumulation of the Republic of Lithuania. Pension accumulation companies have already been warned in writing about possible non-compliance with the requirements of legal acts”, – 15min he commented.
The maximum amount is recovered up to 5 percent. hoarders
Statistics show that, at least for the time being, Tier III fund clients do not take advantage of this option – perhaps because in order to take maximum advantage of the benefit, they would have to set aside 125 euros per month.
According to the data of the State Tax Inspectorate (VMI), the average Tier III client in 2023 104 euros was recovered from the declaration, which is three times less than it could theoretically be. In a decade, his return would amount to 1040 euros.
Žygimantas Gedvilas/BNS photo/State Tax Inspectorate
The maximum amount of 300 euros was recovered by approximately 5 thousand people last year. customers from 118 thousand This is only 4.2 percent. of all clients of Tier III funds.
As we have already written, those who want to recover 3 thousand from the state. of EUR GPM tax should remember that this amount is returned within ten years, so the wallet would add 300 euros per year.
In addition, in order to recover 3 thousand EUR 15,000 will need to be invested in the Tier III fund over the course of a decade. euros, which, according to the state-sponsored idea, should remain in the Tier III fund and earn money until retirement.
In order to terminate the Tier III contract early, you may have to pay various fees and pay the same GPM. However, experts point out that although Tier III taxes are higher, it is much more flexible than Tier II pensions.
What are the differences between these tiers and what to know when choosing to save in the third, you can read HERE: The third tier of pensions: what to pay attention to if you are tempted by the possibility of “getting back 3,000 euros”
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2024-09-02 03:57:16
