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Tax benefits

Payments to private pension savings are deducted from wages before tax. Paid-out wages, therefore, decrease a little less than the amount that is deposited into the savings account, as the tax is paid when the savings are withdrawn. Capital gains tax is not paid on returns.

Matching contribution from employer

No one should miss out on the employer’s matching contribution, given that that the 2% contribution represents a clear pay raise. The employer handles all administration after the agreement on private pension savings has been concluded.

Increased disposable income in old age

On retiring, disposable income inevitably decreases, making it good to have the private pension savings at hand.

The savings are inheritable

Private pension savings are the personal property of the individual and are fully inheritable by legal heirs and divided according to rules stated in the Inheritance Act.

Flexible arrangements

As of the age of 60, it is possible to withdraw the entire amount at once, receive regular payments or receive payments as needed.

Does not reduce certain payments from the government

Private pension savings do not have an impact on old age pensions and income supplements from social security and do not reduce child benefits, interest tax rebates or unemployment benefits.

Private pension application Private pension application

Good to Know

  • What is private pension savings?

    Private pension savings are additional pension savings and personal pension of the person concerned.

    This is one of the most affordable savings available. An employee who deposits 2–4% of their monthly wage receives a 2% counter-contribution from the employer, which in practice is a pure wage supplement. As with other pension savings, no tax is paid on it until withdrawal.

  • When can I get the private pension paid out?

    Private pension savings can be used from the age of 60, provided that at least two years have passed since the first deposit. You can then withdraw everything at once, receive regular payments or receive single payments when necessary.

  • How are private pension savings invested?

    At Gildi, you can choose between three different investment methods which are based on the interaction of returns and risk together with the different needs and risk appetite of fund members.

  • Do private pension savings affect retirement pensions from the public sector?

    Private pension savings do not affect retirement pensions and income supplements from social security.

  • Can I allocate private pension for housing?

    Private pension savings can be used tax-free when buying real estate or as a deposit for a mortgage if certain conditions are met.

  • Are private pension savings inherited?

    Private pension savings are the personal property of the individual and are fully inheritable by legal heirs and divided according to rules stated in the Inheritance Act. If a fund member does not leave a spouse or children, the private pension goes to the estate.

  • Why should I invest in private pension savings?

    The benefits of private pension savings are many and irrefutable. By placing at least 2% of wages in private property, you receive a 2% matching contribution from the employer, which is actually equivalent to a 2% wage increase.

    From the age of 60, you can withdraw the entire credit at once, receive regular payments or receive single payments when necessary.

Guðrúnartún 1, 105 Reykjavík
Hafnarstræti 9, 400 Ísafjörður
Telephone
5154700
Email
gildi@gildi.is
ID No
561195 2779
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Monday - Thursday 09:00 - 16:00
Friday 09:00 - 15:00
Phone hours for department of pensions, loans and premiums
Monday - Friday 09:00 - 15:00
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