Partial Payment Period In Pension: Regulation On Partial Payment In The Private Pension System Has Been Published 28 October 2023

Law No. 4632 on Private Pension Savings and Investment System stipulates that the issues that the Insurance and Private Pension Regulation and Supervision Agency is authorised to determine shall be regulated by regulations and the relevant regulation was prepared based on the sixth article of the law. The Regulation on Partial Payment in the Private Pension System by the Insurance and Private Pension Regulation and Supervision Agency was published in the Official Gazette dated 26 September 2023 and numbered 32321.

The Regulation covers the application to be made by the participants in the individual pension system to exercise their right to partial payment, the evaluation of the application, the cases where partial payment can be made, the calculation and payment of the State contribution to be paid with partial payment, the sanctions to be applied, the duties and responsibilities of the pension supervision centre and pension companies in the partial payment process and other issues related to partial payment.

Within the Scope of the Regulation;

• It is regulated that a participant who has not exercised his/her right to partial payment for at least five years may apply to the company for partial payment of the amount up to fifty per cent of his/her accumulation under the conditions and circumstances specified in this Regulation, from the contract in which he/she has paid contributions at least five times the monthly gross minimum wage amount valid as of the application date.

• It is regulated that the participant may exercise his/her right to receive partial payment within three years from the date of partial payment, provided that he/she gives a commitment that he/she will not terminate the contract subject to partial payment by exiting the system, except in cases of retirement, death or disability. For applications to be made within the scope of partial payment in case of education, this period is applied as four years.

Partial payment in case of marriage or house purchase

• A participant who has a contract in force for at least five years may apply for partial payment from this contract in case of housing purchase or marriage. The right to partial payment can be used from each of the listed cases, one time only on a participant basis.

Partial payment in case of education

• A participant who has a contract in force for at least five years may apply for partial payment from this contract if he/she is enrolled in any formal education undergraduate programme of universities operating in Turkey, provided that he/she has not exceeded the age of twenty-one on the date of application. In case of education, the right to partial payment can be used only once on a participant basis.

Partial payment in case of natural disasters

• In regions where a disaster affecting general life has been declared, participants who have suffered from the disaster may apply for partial payment within six months following the date of the natural disaster. Within the scope of partial payment in the event of a natural disaster, the right to partial payment can be used on a participant basis for one time only and limited to fifty per cent of the last calculated accumulation amount before the date of the natural disaster.
   

• From the account of the participant receiving partial payment, limited to the amount in the State contribution account of the relevant contract on the date of State contribution payment;
  
  a) Twenty per cent of the amount subject to partial payment in case of marriage or house purchase,
  b) Twenty-five per cent of the amount subject to partial payment in case of education and partial payment in case of natural disaster,
  The order to sell the amount of fund shares corresponding to the ratio is given and the cash amount obtained on the day the fund shares are converted into cash is deducted from the State contribution account and paid to the participant together with the partial payment amount.

• The relevant regulation will enter into force six months after the publication date of 26.09.2023.

You can access the entire regulation here.