Claiming Pension Benefits as a foreigner Leaving the Danish Labour market

So many professional and highly qualified workers join the Danish labour market each year. The great opportunities that come for workers in Denmark including fair protections, room for career advancement, job security, attractive salaries and more count among the many things that draw internationals into the country. Again, the existence of the various jobs listed on the Positive list in Denmark makes it possible for expats across the world to access matching work opportunities. 

Even as expat workers keep crossing borders to work in Denmark, most of the workers do not pose to think about necessary things to do when signing off.  With the protective and exciting work environment, there is always the impression that one will live in the country forever. As much as living in Denmark for longer as a worker or even acquiring a Danish citizenship is a possibility, situations may demand otherwise. At such moments of departing Denmark having worked for a period of time, it’s good that you properly process whatever is due to you. One such important thing to carefully follow through is pension savings. 

As may be public knowledge, every employer in Denmark must send pension deductions to the selected pension fund manager from where you as an employee can access as per the provided terms. Ordinarily, the terms of pension deductions are always specified in the employment contract at the time of taking up a job in Denmark.. 

Working in Denmark as an expatriate

As an expat there is nothing so exciting like being able to get a job opportunity in Denmark. What I mean is that Denmark is a great country in terms of education, economic stability and growth. Workers in Denmark are a happy community given the juicy salaries and other complementary benefits that the employers give. In short, if there is any place where employers consider workers as associates and at best try to humanise the work environment, then Denmark is that place. 

I get it, moving to a different country to start something totally new is very complex and hard at the same time. For most people, realising how hard this can be is the real dilemma and therefore you must always have one reason for moving. For most expats it is always work, passion, adventure, and to enjoy the employment benefits offered by a Denmark employer.

If you come to Denmark as an expat, you have a plan or some key goals that you are looking forward to fulfilling. Once you have achieved your goals, your duration has expired and accomplished your task, you may want to leave and go back home. Many expats are highly skilled professionals and most probably would be headed to their next destination for work. So, how do you claim your pension money? 

Types of Pensions in Denmark 

The government of Denmark has different types of pension schemes to offer. However, it depends on a number of factors like, for example, your conditions of employment. Additionally, such factors could depend on the number of years you intend to work and live in Denmark. Also, if you are employed in the public or the private sector. 

In general, the following pension schemes are present in the Danish government:

  • Labour market pension
  • Individual pension
  • State pension
  • Foreign pension

One criterion to note is that there is however a common rule that the pension scheme adopts in Denmark. The state and the labour market pension scheme are compulsory while the remaining two are more flexible. Their flexibility is closely attributed to your employer. It can either be part of your workplace salary package or a private pension scheme.

Are Expats Entitled to a Danish Retirement Pension?

It is a general rule that when you live and work in Denmark, you are entitled to a right to a Danish retirement pension. The office for international social security at Udbetaling Danmark will help you in case of such issues. 

Generally, your right to Danish pension money as an expat depends on the number of years spent working in Denmark. In some cases, it will depend on whether you are awarded senior pension or disability pension. Nonetheless, you are entitled to a full retirement pension if resided in Denmark for 40 years in your period of work. If this is not the case, you are entitled to a partial pension commonly termed “fractional” retirement pension. A fractional pension is calculated on the duration of time you have lived and worked in Denmark as an expat.

However, the other periods which you remained covered by the social security system of another state while in Denmark, are excluded. If you have spent less than a year in Denmark, you are not in any way entitled to a Danish retirement pension.

When to Claim

The Danish government may allow you to receive your retirement pension 1-3 years ahead of official retirement age. However, this can only be possible if you meet a number of required conditions. 

Receiving your public old-age retirement pension is only possible in Denmark once you reach your public retirement age. Of course, this is also very possible if you meet the required threshold. Here the age will depend on your date of birth.

There is something called the ATP Life-long Pension in Denmark. It refers to the statutory pension received by majority of Danes in addition to their public old age pension. You receive your ATP Life-long pension when the contributions have been submitted for you and have attained the public retirement age. 

In case of the death of your spouse or cohabiting partner, both of you are entitled to old age pension. Then you are entitled to receive their old age pension for 3 months after their passing. It is called the survivor’s pension but, in some instances, called the assistance for survivors.

The Conditions to Meet

The employment benefits include the pension scheme or system. It is a fact that the Danish pension scheme can be very complicated for internationals and expats working in Denmark. There are a number of rules and regulations that are involved in the Danish pension scheme for expats. 

The common requirement for claiming your Danish state pension money is that you are an EU/EEA citizen. This means that unless on special grounds, a foreigner from outside EU or EEA may not get the state pension. Those from Switzerland or UK but working in Denmark must be covered by the Trade and Cooperation Agreement. 

Besides, you must have had a total of at least 3 years of earned entitlement to pension. Of course, one of the three years must be that which was earned in Denmark. On a good note, the ATP Life-long Pension is compulsory by the Danish law. But this is applicable to citizens who have been employed on the public or private labour market.

What you are Entitled to

Early retirement pension is a temporary benefit that has a basic amount attached to it. It is the same amount for single people as well as cohabitants. The amount averages to DKK 13, 550 monthly. 

However, this amount is narrowed if your income level is above DKK 24,000 annually. This is also possible if your private pension accumulation is more than DKK 2 million.

On the other hand, the public old age pension is a life-long benefit. It comprises of the basic amount and a supplement. The basic pay is same for both the single and cohabiting persons. But, the amount of the supplement depends on your marital status.