Pension fund transfer from Belgium

Finance, Taxes, Banking, Insurance and Retirement
1
Another pension fund transfer question... from Belgium this time.

I have searched the forum and have read many other threads on the topic but could not find an answer to my question.

Hubby and myself have built up some money in a few Belgian pension funds (pillar 2) but we would like to have all money consolidated into one, preferably the one we currently have in Switzerland.

So I have contacted the pension fund in Belgium to understand if such a transfer is possible (Switzerland not being part of the EEA); and if so, what is needed to do such transfer, etc. Much to my surprise, the Belgian fund said that there is no problem in transferring the money to Switzerland, as long as it goes into another similar pillar 2 fund. There are a few % deducted for social security charges (3% or something) but the transfer itself can be done taxfree provided a certificate of Swiss domicile can be provided and that the Swiss fund provides all required info so that the money can be transferred into that fund.

Good news, so I thought...

I then contacted our Swiss pillar 2 fund (AXA) and was told that no, this is not possible. When I asked why, answer was that Swiss law prohibits such transfers... I insisted in getting more information to understand why this is not possible but was told off instead.

So I am still puzzled why this would not be possible? Does it have to do with AXA perhaps? But why would they refuse to get money transferred into their fund? I had expected that the Belgian fund would be the difficult one.

Can anyone shed some light on what the reason could be that AXA refuses to accept the transfer?

2
After submitting a request via the AXA website, I got an answer to my question... my problem is indeed AXA related...

This is the response I got:

Dear Mrs.,

Some of our neighbor states have amended the legal requirements regarding the transfer of pension fund assets to foreign countries. Consequently it is now possible under certain conditions to transfer assets that were accrued abroad tax-free to an occupational benefits institution in Switzerland.

Swiss legislators responded to this development and amended Art. 60b of the Ordinance on Occupational Retirement, Survivors' and Disability Pension Plans (BVV2). As of January 1, 2011, persons who were previously insured abroad can transfer their pension fund assets tax-free to a Swiss occupational benefits institution, provided that the regulations of the institution in question permit such a transfer.

AXA Life Ltd reviewed the supplement to Art. 60 b BVV 2 and has decided for a variety of reasons not to implement this voluntary option.

Swiss occupational benefits institutions have a long-term obligation to disclose information, in particular vis-à-vis the UK tax authorities, whenever they make advance payments of benefits from previously transferred pension fund assets. The disclosure obligation would also apply, for example, when an insured person changes job and transfers his/her vested benefits to a new occupational benefits institution. The disclosure obligation applies in such cases and may lead to a situation in which the occupational benefits institution becomes liable for lost tax revenue if it fails to fulfill the relevant provisions.

The wording of the ordinance also stipulates that the accrued pension fund assets must be transferred directly from the system of the occupational benefits institution in the foreign country. Responsibility for verifying which states have a system of this kind for managing occupational benefits is borne entirely by the receiving institution in Switzerland. This means that each request by an insured would entail comprehensive investigation. The origin of foreign pension fund assets would have to be verified precisely, which means that a money-laundering check would have to be carried out.

Implementing the provisions of the new ordinance would therefore require extra administrative resources and result in considerable additional costs. Moreover, the possibility of liability risks and problems in connection with money-laundering lead us to believe that this, unfortunately, is not the right time to implement this provision. Furthermore, we receive only a very small number of requests from insured persons for transfers of this kind.

For these reasons, we have decided not to implement this voluntary provision of the ordinance.

3
I had exactly the same problem 24 years ago. I really cannot remember how my fund was transferred, maybe Germany paid me cash and I then paid it into the Swiss fund.

BUT, many pension funds will credit you with more value if you leave the fund intact, and take a small pension when you are 65, than if you withdraw cash today. But don't quote me, I am not an expert!

4
The UK rules they refer to are the famous QROPS regulations, where the UK HMRC imposes on the Swiss (in this case) pension some reporting obligations. There are Swiss freizugigkeitskonto/compte de libre passage that are QROPS approved eg Pictet (free advertising as I used them for this an was very happy) that you can open to receive the funds. From there you could transfer the monies to your main pension or leave them there.

You need to research the Belgian rules similar to this, and use that to identify any Swiss funds that comply with those rules.

5
The rules have completely changed in the last 5 or so years...

6
My husband transferred his Belgian pension into the second pillar pension in Switzerland when he came here four years ago. He will receive a much better pension than if he had left the money in the Belgian scheme.

I will have to double check with him who the pension fund is with.

7
I have first and second pillars in both UK and Germany and wish to transfer them to Switzerland. So any information you get on doing this would be greatly appreciated.

Is there not some advisor about who handles such inter-European transfers?

8
Apparently it all depends on your pillar 2 scheme in Switzerland.

Only a few of these will accept to transfer the funds. I know that for example Swiss Life does it but AXA does not.

9
So I got confirmation some time ago that I cannot transfer my pension funds in Belgium into my Swiss one because Axa simply doesn't do it (too much hassle as I understand it).

Now a friend has a similar question but this time for a transfer into a pension fund with Credit Suisse. He will check with the pension fund but perhaps anyone on this forum can tell straight away as I understand some people here work at Credit Suisse... Does anyone know if the Credit Suisse pension fund allows transfers from Belgian (or other EU countries') pension funds?

10
Hello Griet,

I am in a similar situation now (new comer Belgium =>Switzerland).

did you manage eventually to solve the issue and transfer the fund to 2nd pillar in Switzerland?

Thanks

11
Hi Aladin,

I didn't but it all depends on the pillar 2 company you have in Switzerland.

It apparently involves a lot of paperwork and not all companies are willing to do this work.

I believe that Swiss Life and Allianz are willing to do so, unfortunately my pillar 2 is with AXA.

So in theory it is possible, but if your pillar 2 company does not offer this

service, nothing you can do unfortunately. At least, that is what I understand.

Best regards

12
My husband did it but it was with Swiss Life.

13
Griet, Belgianmum

thanks a lot for the info.

I suspected the reply from the insurance company, since it was unclear.

Now I understand it is not an overall Swiss law that prohibit this, rather than a Swiss law that let the insurance company decide if they allow the transfer or not.

The funny (or not) thing, is that I keep get negative answers from Swisslife which is my insurance company in Switzerland.

Belgianmum, do you have any reference in Swisslife that handles such cases?

Thanks again!

14
Thanks a lot Belgianmom & Griet for the info, which let me initiate this process!

Took me 2 years, with many "no's" (especially in Belgium), but eventually it's done!

15
Interesting, I got a completely different response from Swiss Life in December, being told that the Law in Switzerland does not allow integration of foreign pension funds in the 2nd pillar.

Is this really the case? This looks like to be the pension law, but I haven't found the related topic.

16
Integer, its concluded in my case on the positive side.

Actually after my experience, other 2 colleagues (who came from Belgium) did the same.

It was a long process which took about 2 years.

Regard:

"Interesting, I got a completely different response from Swiss Life in December, being told that the Law in Switzerland does not allow integration of foreign pension funds in the 2nd pillar."

I dont think that is the case, but not sure 100%.

We could always say that AXA is active in CH, so its not really a different insurer than the one in BE. So, actually the move is from AXA to SwissLife

Last but not least, please note that his is a headache for the insurance companies. maybe try to insist a bit more, or use a good broker services.

good luck!

17
Still the same sitaution as when this thread was started.

Swiss law allows, but the it is voluntarily for the pension fund to offer this option.

The relevant law was fortunately mentioned in the response from AXA. it is Art. 60a BVV 2. See https://www.admin.ch/opc/de/classifi...ndex.html#a60b

18

Dear Texacous, BelgianMum,
Were you taxed in Belgium on the amount you transfered?
I am also looking to transfer my ‘groepsverzekering’ from Belgium into Switzerland with an attempt to consolidate. My pension is with AG Insurance. They have told me so far that if they transfer to CH they will have to levy tax on the amount, and it will be up to me to try to recover the taxes with the Belgian authorities. This tax could be as high as 40%. And if I read the law on it, my chances to see that money back seem very slim. There is specific reference to a so called ‘Avenant’ which went into force on July 19, 2017 specifying that the country where the individual had the fiscal benefit of paying into a pension fund, is the country that can levy the taxes on it. In this case this would be Belgium at an average rate of 33% (due to early withdrawel of the reserves).
Anyone else any experience with this?

19

No, we didn’t pay any tax on it in Belgium but it was before 2017.