The Republic of Latvia is a Baltic state with a population of just under 2 million. It is located in the north of Europe between Estonia and Lithuania. The country's economic potential is concentrated in the capital - Riga, where more than 50% of GDP is produced. About 60% of enterprises of Latvian manufacturers operate in the capital region. Living standards in Latvia are slightly lower than in most EU member states. Let's consider who and how the pension is accrued in Latvia, and what benefits elderly people living in the republic can count on.
Latvian pension system
The pension system of the Republic of Latvia includes 3 levels:
- The first provides for the payment of retirement benefits, the source of which is the totality of funds allocated by the able-bodied population of the country.
- The second level is a pension accumulated by the state for a specific elderly person. All residents of Latvia born after 07/01/1971 fall under this level.
- The third level is formed due to voluntary savings: a person of working age deducts, in addition to the compulsory insurance premium, a certain amount; when retirement takes place, it will return as a supplement to the basic pension.
The size of the Latvian pension
The number of pensioners in Latvia is increasing from year to year: the growth over the last 10 years has been approximately 2-3%. So, as of the beginning of 2021, 320 thousand elderly people live in the country. This is approximately 20% of the total population.
The minimum pension in the Republic of Latvia fluctuates around the 100 euro mark. This social benefit is received by approximately 5.1% of the population of the state. It is enough for food only on condition of serious savings. The insufficient level of state aid for the elderly is especially noticeable against the background that the minimum wage in the country is 4.3 times higher - 430 euros.
The average pension in Latvia at the beginning of 2021 is 320.27 euros:
- social benefits ranging from $ 100 to $ 200 are received by about 6.6% of the republic's residents;
- the majority of pensioners (48.2%) have payments in the range of 200-300 euros;
- an allowance in the range of 300-400 euros is paid to 24.4% of Latvian pensioners;
- pensions from 400 to 500 euros only for 7.4%;
- 8.3% of pensioners receive from 500 to 1,500 euros, and only 1,836 people receive a pension of more than 1,500 euros.
The poverty rate among the elderly in Latvia is on average over 50% - the highest figure in the European Union.
Retirement age
If in 2021 Latvians who have stepped over the age limit of 63 years and 3 months could go on a well-deserved rest, then in 2021 this can be done by citizens who have an insurance record of at least 15 years, after whose 63rd birthday six months have passed. This is due to the fact that the retirement age in Latvia, starting from 2021, increases annually by 3 months.
On a well-deserved rest, you can go ahead of schedule. People with an insurance record of at least 30 years can receive an old-age pension two years earlier than the period established on a general basis.
Also, the privilege of obtaining the right to pension benefits as early as possible applies to:
- a parent or a person in the status of a guardian:
- having at least 25 years of experience;
- who has been raising 5 children or a disabled child for at least 8 years;
- persons who took part in the elimination of the consequences of the man-made disaster at the Chernobyl nuclear power plant. If the length of service is at least 15 years, they can become pensioners 5 years ahead of the deadline, which was established on a general basis.
In addition, early retirement pension in Latvia is available:
- women with disabilities;
- persons who have lost their eyesight;
- dwarfs;
- persons who worked before 1996 at industrial enterprises with unhealthy working conditions.
The Latvian government plans to stop raising the retirement age annually only in 2021. It is not difficult to find out the goals pursued by the executive branch of the country. Simple arithmetic calculations show that the answer to the question of how old they retire in Latvia will then sound like this: after the 65th birthday.
How pensions are calculated
The source of pension payments is payments deducted every month during the period of a citizen's employment. The levy collected for these needs is 35%, but most of the contributions are payable directly by the employer. Only 10.5% of the employee's monthly wage is withheld from the employee's salary.
To find out what kind of pension in Latvia is due to an individual citizen, you need to apply the following formula:
RP = SPK / PKL: 12, where
RP - the size of the monthly pension;
SPK - the amount of pension capital. What part of these indicators is taken into account will be discussed below;
LCP is the planned number of years of pension payment.
In this case, the funded capital is added to the SPK. And the value of the required parameter is a value derived from a number of conditions.
To clarify the above formula, it should be said that, in particular, the old-age pension depends on:
- the amount of pension capital accumulated from 01.01.1996 until the month from which the benefit will be paid;
- the average rate of insurance premiums from 1996 to 1999;
- total insurance experience until 31.12.1995;
- the planned time interval for the payment of the pension.
On September 27, 2021, the Seimas of the Republic of Latvia adopted in the final reading important amendments to the law on social benefits for the elderly. They provide that not only the pension itself is subject to indexation, but also additional payments for seniority.
Those persons who have a higher value of the last indicator are provided with preferences. They are as follows: the indexation of pensions in Latvia in 2021 for citizens with a work experience of 45 years will be carried out using 80% of the real value of the percentage increase in salaries, on the basis of which social insurance contributions are determined. Let's remind that up to now the figure of 70% figured in the calculations.
Also on this day, the Seimas adopted in the final reading amendments to the law regulating the collection of personal income tax. Their action is also aimed at improving the well-being of elderly people.
In particular, taxes on pension in Latvia will be charged only if its monthly value exceeds:
- in 2021 - 270 euros;
- in 2021 - 300 euros;
- starting from 2021 - 330 euros.
The Ministry of Finance of the Republic of Latvia has published forecasts for the state of the country's economy after the increase in the non-taxable minimum for pensioners to 3,960 euros / year: this will cause a negative fiscal effect for the budget in the amount of 11.8 million euros. And this phenomenon is not the only one that can cause a decrease in trust in the government on the part of people receiving state benefits.
Thus, the disability pension is currently paid in Latvia to almost 35 thousand people with disabilities. They are provided with additional payments for experience on average 12.34 euros / month.
Experts have calculated that the income of citizens of this category, with the indexation of additional payments in 2021, will increase before income tax by an average of 2.32 euros / month. Naturally, such a slight increase in disabled people does not cause enthusiasm.
The amount of pensions in Latvia for persons of this category is given in the table.
| Disability group | Pension size, euro | Pension size, rubles |
|---|---|---|
| I group | 102.45 | 7592.57 |
| II group | 89.64 | 6643.22 |
| III group | 64.03 | 4745.26 |
Peculiarities of registration of a Russian pension in Latvia
Russian pension in Latvia is paid to persons residing in the territory of the Baltic country if:
- they have reached the retirement age established in the Russian Federation;
- they are entitled to a pension by:
- loss of a breadwinner;
- length of service;
- obtaining a disability group.
At the same time, insurance premiums paid on the territory of Russia are taken into account.
How is the Russian pension paid
To resolve the issue of assigning a pension benefit for the periods of employment after 01.01.1991, you must contact the department of the State Social Insurance Agency of Latvia (hereinafter SSIA). There you will need to provide documents:
- application with a petition for the appointment of a pension;
- papers confirming labor activity and the equivalent time of stay in the territory of both states - Russia and Latvia;
- a package of documentation corresponding to the intended type of pension.
The received documents are forwarded by the SASS to the Pension Fund of the Russian Federation. It is there that a decision is made regarding the granting of a pension to a person residing in Latvia.
The length of service in Russia may not be enough to receive pension payments. Then the period of official work in Latvia is also taken into account. But the calculation of the pension is made on the basis of only the Russian length of service.
Pension is paid through the SSIA at intervals of once a quarter. Receive money in one of the banks of the Republic of Latvia or by mail. In the first case, the account number of the credit institution is indicated, which can be found from the agreement concluded with the bank.
Benefits in Latvia for pensioners
On the territory of the Republic of Latvia for citizens of retirement age there are benefits at the national and local levels. In the first case, the following subsidies are provided:
- former juvenile concentration camp prisoners receive financial assistance for:
- compensation for the so-called patient contribution;
- purchase of medical supplies and medicines;
- dental prosthetics.
For people whose only income is a state pension and who do not have health insurance, benefits are provided:
- Those who survived the siege of Leningrad can count on financial assistance for the purchase of medicines, dentures, the purchase of a coffin and a cross. If they are classified as poor, they are entitled to free meals for 2 months a year.
- Pensioners who are in the status of politically repressed have the right to free travel in public transport and dental prosthetics. For them, financial assistance is provided for the purchase of a coffin and a cross.
- Lonely pensioners living in a room without amenities have the right to visit the baths free of charge twice a month.
Let us briefly consider what benefits are provided to pensioners in Latvia by local authorities. The widest package of social benefits is offered in Riga. Let's name just some of the positions:
- the amount of assistance from the municipality to cover the aforementioned patient contribution is 71 euros;
- pensioners with low-income status, whose monthly income is less than 127 euros, are entitled to a subsidy;
- elderly people with any group of disabilities receive assistance in the amount of up to 2,134 euros for home improvement;
- those who have reached the age of 100 are assigned a one-time payment of 150 euros.
Benefits are also provided in other Latvian cities. For example, in Daugavpils, pensioners can use public transport for free.
From January 1, 2021, after the death of a pensioner, his widowed spouse will be able to receive half of the deceased's pension. This right can only be exercised by recipients of old-age, disability or seniority pensions.
The allowance will only be paid to widowers; divorced spouses or couples who live in unregistered relationships are not eligible.
Military pensioners in Latvia
In 2021, the employees of the Latvian National Audit Office recorded the fact that Russian pensioners, former military personnel, received cash payments from two states at once. The reason for this situation was the coincidence of the base periods used for settlements and cash payments.
To correct it, the Latvian executive power decided to stop payments for the periods paid by the Russian Federation. They mean:
- time of passage of urgent military service;
- period of extra-urgent stay under the banners of the USSR Armed Forces;
- service in structural divisions of internal affairs;
- time of study in higher educational institutions.
Now military pensions in Latvia to Russian pensioners who are former military personnel are paid solely on the basis of seniority. But only if the value of this indicator meets the requirements of the current legislation.
The average length of service pension of a Russian citizen with the status of a military pensioner by 2021 in the Republic of Latvia fluctuates in the range of 550-560 euros.
Conclusion
According to the legislation, all residents of Latvia with a work record of at least 15 years, who have crossed the age limit of 63 years and six months, have the right to receive a pension benefit. But there are exceptions that provide the opportunity to go on a well-deserved rest earlier.
Since 2021, the Republic of Latvia has ceased to make payments to military pensioners for the periods that were previously paid by Russia.
