From the end of July until the end of September, EFKA is expected to complete the payment of back payments up to €8,500 to 90,000 retirees in three categories. The back payments concern pending pension recalculations that will bring significant financial relief to beneficiaries.
Read: Pensions: Back payments up to €11,500 to 90,000 beneficiaries
Which retirees are entitled to back payments
The retirees who will receive back payments are divided into three categories:
• 40,000 beneficiaries with improved replacement rates under the Vroutsis law for pensions with 30 or more years of insurance from 29 main funds
• 42,000 military retirees who won court decisions for reduced deductions
• 8,000 public sector retirees who were granted reduced solidarity contribution for the period 2017-2018
Recalculations under the Vroutsis law
The first package of back payments concerns 40,000 retirees with improved replacement rates under the Vroutsis law. These retirees have incomplete data on their insurance years or earnings, or belong to cases with pensions from successive insurance or with work after retirement.
For retirees who have completed more than 30 years of insurance, their pensions were recalculated in October 2023. Specifically, for those who had 31 years of insurance, the increase starts from 1.08% on the contributory pension, while for those whose pension was calculated with 40 years of insurance, the increase reaches 7.2%.
Back payments for military retirees
EFKA began recalculations of reductions for military retirees’ pensions exceeding €2,500. These are back payments of €1,200 to €3,500 expected to be given gradually during summer, with amounts corresponding to 27 months.
The back payments stem from the fact that the reduction under law 4093 ceased to be imposed by law from April 2023 on dividends received by military retirees from their equity funds and remained only on main pensions.
Public sector retirees and solidarity contribution
Back payments up to €8,500 are expected to be received by 8,000 public sector retirees who have been vindicated by lawsuits they had filed in 2015 regarding the withholding of solidarity contribution. Those who filed appeals to the Court of Audit from February 2017 through 2020 for the return of deductions from solidarity contribution are entitled to 23 months of back payments.
Deductions and taxes on back payments
The back payment amounts are gross and the imposed deductions are 6% withholding for healthcare, graduated withholding from 3% to 14% due to the Special Solidarity Contribution for pensions exceeding €1,400, as well as 20% tax on the back payment amount.
The increases start from October 2019 and until now retirees are entitled to back payments for 68 months, which explains the high amounts to be paid.
