Retirement in Ukraine in 2023: Pension Age and Required Insurance Record
In 2023, both men and women were required to reach the age of 60 and have at least 30 years of insurance record to qualify for an old-age pension in Ukraine. If a person did not have 30 years of insurance record but had between 20 and 30 years, they could qualify for a pension at the age of 63. If a person had less than 20 years but at least 15 years of insurance record, they could apply for a pension upon reaching the age of 65.
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It is also possible to purchase additional insurance record if a person does not have enough years to qualify for a pension. To do this, the person must first apply to the Pension Fund, obtain a refusal to grant a pension and receive a calculation of their insurance record. The person may then apply to the State Tax Service and enter into an agreement for the voluntary payment of the Unified Social Contribution (USC) for certain periods during which they were not employed. The amount payable for one month is calculated as twice the minimum insurance contribution applicable in 2023. Therefore, one month of additional insurance record would cost almost UAH 3,000. After payment of the USC and receipt of the funds by the State Tax Service, the person must apply to the Pension Fund again and submit a new application for a pension.
In 2023, when calculating a pension, each year of insurance record was generally taken into account at the rate of 1%. This means that with 30 years of insurance record, the insurance record coefficient used in the pension calculation would amount to 30% of the earnings taken into account for pension purposes. When determining earnings for pension calculation purposes, all salary information contained in the personalised records is taken into account, as well as, at the person’s request and subject to the applicable legal requirements, salary for any 60 consecutive calendar months of employment before 1 July 2000. The person’s individual salary coefficient is applied to the average salary (income) in Ukraine from which insurance contributions were paid for the three calendar years preceding the year of application for a pension.
In 2023, pensions of working pensioners who had acquired at least 24 months of additional insurance record after their pension was granted were subject to automatic recalculation.
Pension indexation in 2023 was to be carried out within the financial resources of the Pension Fund in accordance with a decision of the Cabinet of Ministers of Ukraine.
However, there was no increase in the minimum pension resulting from an increase in the subsistence minimum, since the subsistence minimum for persons who had lost their capacity to work remained at the December 2022 level throughout 2023. It amounted to UAH 2,093.
If a person reached retirement age and had the required insurance record but continued working, they could postpone retirement and receive an increase in their future pension for the period of deferment. For each full month of insurance record acquired after reaching retirement age, the pension could be increased by 0.5% if retirement was deferred for up to 60 calendar months, and by 0.75% for each full month if retirement was deferred for more than 60 calendar months. For example, a 10-month deferment would result in a 5% increase in the pension. A person wishing to postpone retirement must notify the Pension Fund accordingly.
