The Pension Information is Decisive for Calculating the Bridging Benefit
The most important thing first: you require binding information concerning the balance of your insurance account in the statutory pension insurance if you want to apply for the bridging benefit – this is referred to as the “pension information”. It is therefore important for you to ensure that your pension insurance account is fully clarified in good time. You need to obtain information on the amount of your pension payment so that the Social Insurance for Seafarers can calculate your bridging benefit. A condition for this is that you have met the waiting time for this seafaring insurance benefit. You can also apply for the pension information through the Deutsche Rentenversicherung Knappschaft-Bahn-See.
Forecasts are irrelevant
The information that you are provided with is always based on the balance of the pension account at the time you make the request. Forecasts with regard to future pension insurance times are not possible and they are irrelevant for the calculation of the bridging benefit.
What does not play a role when calculating the bridging benefit:
- Pension adjustments in the statutory pension insurance do not have an effect on Social Insurance for Seafarers benefits.
- The regulations pertaining to the statutory equalization of old-age pensions in the event of a divorce and income splitting between spouses do not have validity for the bridging benefit.
The bridging benefit is not calculated on the basis of projected rights and periods that are pursuant to …
This is a serious matter: the insured person´s duty to cooperate
There is a “duty to cooperate“ in all of the social insurance branches. This also has validity for insured persons in the Social Insurance for Seafarers.
What does that mean? If you are in receipt of benefits from the seafaring insurance, you have an obligation to informing us should there be any experiences in your life that result in the bridging benefit being reduced or being stopped. This can also occur if you are in receipt of other social insurance benefits.
You will find additional information under “Your notification and application duties“.
Which Benefits are set off against the Bridging Benefit?
You are in receipt of, or are entitled to
- an occupational disability pension?
- a partial reduction in earning capacity pension?
- pension due to a full reduction in earning capacity as a partial pension?
- age-related partial pension?
The benefits paid by the statutory pension insurance are set off against the bridging benefit.
If you are in receipt of unemployment benefit I, it is possible that this shall be set off when calculating the reduction compensation.
Note: the aforementioned pensions from the statutory pension insurance and the unemployment benefit I also reduce the bridging benefit even if you should not apply for these benefits.
All of the bridging benefits that have already been paid are set off against the “benefit before or after reaching the statutory retirement age”. This is also the case with regard to the supplementary benefits paid by the Social Insurance for Seafarers.
These benefits are of no relevance when calculating the bridging benefit:
- Employment remunerations from work on land
- Sickness benefit
- Injury benefit
When is there no longer an entitlement to the bridging benefit?
Seamen are paid a “seaman´s pension“ so that they can financially bridge over the time between the end of their work at sea and the commencement of their pension payments.
This is why there is no longer an entitlement to the bridging benefit if you
- are paid or would be entitled to a full pension due to a reduction in earning capacity or
- a full age-related pension.
You are in receipt of the bridging benefit and all of the supplementary benefits from the Social Insurance for Seafarers until you receive your personal statutory old-age pension.
In the case of full age-related pensions, the pension is reduced should you file the pension application before your personal retirement age. In this case, the Social Insurance for Seafarers checks whether you are entitled to a compensation benefit.
Keyword: unemployment benefit I
The following principle has validity: the bridging benefit follows the unemployment benefit.
The unemployment benefit I is to be taken avail of before the bridging benefit. You cannot choose between these two benefits.
If you are in receipt of unemployment benefit I, you should only apply for a full age-related pension after you are no longer in receipt of this benefit. This provides you with the opportunity to increase your old-age pension as periods of unemployment are taken into account for your pension.
An additional benefit: as the pension payments commence later, this results in your pension not being reduced (or only slightly) as a result of the pension being paid prematurely.
Employment on Land after you no longer Work at Sea
A case that is not so seldom; the seaman no longer works at sea and receives the bridging benefit. He then accepts employment on land and becomes unemployed. What now? The seaman is again in receipt of unemployment benefit I. The consequence: the bridging benefit payments are stopped.
There is also no longer an entitlement to the core benefit paid by the Social Insurance for Seafarers if unemployment benefit I is only not granted because
- it has not been applied for, or
- no registering as being unemployed has been carried out, or
- you are entitled to a sickness benefit instead of unemployment benefit I, even if you have not applied for it.
Important: if your unemployment benefit I is lower than the bridging benefit, the Social Insurance for Seafarers pays the difference. This therefore does not result in your financial situation worsening. The Social Insurance for Seafarers does not expect you to give up employment on land so that you can apply for unemployment benefit I and exhaust this.
Employment at Sea again
You are already in receipt of a bridging benefit or other benefit from the Social Insurance for Seafarers and now want to return to sea – perhaps on board a ship sailing under a foreign flag? That is not a problem. The payment of the “seaman´s pension“ will be suspended during this period however. A demand shall be made for a reimbursement of any overpaid amounts. The benefit shall basically be paid again as soon as you no longer work at sea.
The payment of the “benefit before or after reaching the statutory retirement age“ is not affected by this rule; it is not suspended but is paid out without interruption.
When is the Bridging Benefit Reduced?
There are situations that result in the bridging benefit being reduced.
This concerns the seaman who is not entitled to a full age-related pension. If he receives a bridging benefit as from 1 January 1999, then this shall be reduced. The same amount is deducted as is deducted from the full age-related pension due to the earliest possible availment.
You can avoid this by continuing to register unemployed after you are no longer entitled to unemployment benefit I so that additional unemployment periods can be credited to your pension. Your entitlement to
- a full pension due to a reduction in earning capacity or
- a full age-related pension
are not affected by this.
Bridging benefits that are paid as a difference are not subject to this reduction.
Detailed information on the earliest possible commencement of a full age-related pension and the insurance law conditions are described in the Deutsche Rentenversicherung ”Die richtige Altersrente für Sie“ (The Right Old-age Pension for You) brochure. Obtain personal advice from the specialists in the Deutsche Rentenversicherung Knappschaft-Bahn-See Information and Advice Centres. This is where you shall be provided with competence assistance.
An important note:
The old-age pension is subjected to additional income limits. Should an employment result in these being exceeded, you are nevertheless entitled to your bridging benefit.
Should you restrict your employment or terminate it (you not having an obligation to do so), you are to apply for an age-related partial or full pension. When you receive the pension payments, the bridging benefit payments shall be stopped or they shall be reduced. This is also valid for other social insurance benefits.
This is Important: your Notification and Application Duties
It is completely in your own interest: if you are in receipt of a benefit from the Social Insurance for Seafarers, you have an immediate obligation to provide notification should you return to sea or work on land.
And: no matter whether you are in receipt of a benefit from the unemployment insurance or the pensions insurance – you are to inform us of this. This especially prevents any claims being asserted by the Social Insurance for Seafarers for a repayment of insurance benefits.
Please also do not forget that you have an obligation to file applications for all of the statutory social insurance benefits that you could be entitled to. The benefits from the Social Insurance for Seafarers shall otherwise not be granted to you or they shall be reduced.
The Social Insurance for Seafarers checks whether you are entitled to a social insurance benefit.
Tax Law: The Bridging Benefit is subject to Taxation
How does the tax law valuate payments that the Social Insurance for Seafarers makes to the insured persons?
The bridging benefit and all other ongoing payments are basically subject to taxation – as is the case with all pensions paid by the statutory pensions insurance. They are designated as being “other income” and are treated as a so-called “reduced life annuity”.
The bridging benefits that are paid by the Social Insurance for Seafarers differ from the pensions paid by the statutory pensions insurance in that they are not affected by the tax law changes that came into effect on 1 January 2005.
The pensions that are paid by the statutory pensions insurance are subjected to deferred taxation as from this date but the bridging benefits paid by the Social Insurance for Seafarers continue to be taxed with the taxable proportion.
What does this mean? The bridging benefit is not taxed with the full amount, but merely with a taxable proportion that is defined by law. The amount depends on the age of the seaman when he receives the bridging benefit.
The single deduction compensation payment is not taken into account as far as the income tax is concerned.
Further information on this subject is available in the German Pensions Insurance brochure “Versicherte und Rentner: Informationen zum Steuerrecht“ (tax law information for insured persons and pensioners).
Whether you have to pay tax on the benefits you receive from the Social Insurance for Seafarers depends on your personal situation. An example being whether you or the spouse who you are jointly taxed together with, has other taxable earnings. These earnings are added to the taxable part of the bridging benefit.
You can obtain more detailed information from your tax office.
In its capacity as the body responsible for the Social Insurance for Seafarers, the Deutsche Rentenversicherung Knappschaft-Bahn-See has a legal obligation to providing the Central Benefits Agency for Retirement Assets (ZfA) with an annual notification of the benefits that have been paid out by the Social Insurance for Seafarers. This forwards the data to the responsible state tax authorities.
Please provide us with your Tax Identification Number
The Federal Central Tax Office has been issuing each citizen who is registered in Germany with his or her personal Tax identification Number since 1 August 2008. This replaces the tax number that was previously used for income tax purposes. In its capacity as the body responsible for the Social Insurance for Seafarers, the Deutsche Rentenversicherung Knappschaft-Bahn-See requires the number for the so-called pensions receipt notification proceedings. You have a legal obligation to provide the Identification Number.