Pensionimaksed

Pensionimaksed refers to pension contributions made in Estonia. These contributions are mandatory for employees and employers, and also for self-employed individuals. The purpose of these payments is to fund the state pension system, which provides financial support to individuals after they retire.

The Estonian pension system is a three-pillar system. The first pillar is the mandatory state pension, funded by pensionimaksed. This pillar ensures a basic level of income for all residents. The second pillar is a funded pension, where a portion of the mandatory contributions is invested in a pension fund, aiming to grow the retirement savings. The third pillar consists of voluntary private pension savings, which individuals can opt for to supplement their state and funded pensions.

Pensionimaksed are calculated as a percentage of an individual's gross salary. Both the employee and the employer contribute a set percentage. For self-employed individuals, the contribution rate is based on their declared income. These rates can be subject to change by government regulation. The collected pensionimaksed are managed by the Estonian Social Insurance Board and invested by pension fund managers. The amount of pension an individual receives in retirement depends on their years of contributions, the total amount contributed, and the returns generated by pension fund investments.