Today's Edition
ABU DHABI (WAM)
The General Pension and Social Security Authority (GPSSA) highlighted that purchasing additional service years allows insured individuals to add years to their recognised contribution period, which may increase their pension value.
The requirements vary depending on the pension law covering the insured individual.
Those covered by the Pension and Social Security Law of 1999 may apply after completing 20 years of service.
Those covered by the Pension and Social Security Law of 2023 may apply after completing at least 25 years of service, or after completing 15 years of service and reaching the age of 60.
For example, a 47-year-old with 17 years of service under the 1999 Law cannot purchase three additional years to meet the 20-year requirement.
Similarly, under the 2023 Law, completing 15 years of service is not enough unless the individual has also reached the age of 60.
In general, the 2023 Law applies to Emiratis who joined the workforce for the first time on or after October 31, 2023 with an employer covered by GPSSA.
Insured individuals who were already covered by the 1999 Law remain subject to its provisions, including when moving to a new employer.
Under the 1999 Law, men may purchase up to five additional years of service, while women may purchase up to 10 years.
Under the 2023 Law, both men and women may purchase up to five years.
Insured individuals are not required to purchase the full period available and may choose to purchase one or more years according to their needs.
GPSSA also explained that purchasing additional service years cannot bring an insured Emirati's total recognised service period above 35 years, at which point the pension reaches its maximum rate.
For example, an insured individual with 33 years of service may purchase up to two additional years, while an insured individual with 31 years of service may purchase up to four years.
The cost is calculated using the contribution account salary on the date the application is submitted, multiplied by the applicable contribution rate and the number of months being purchased.
The applicable rate is 20 percent for insured individuals covered by the 1999 Law and 26 percent for those covered by the 2023 Law.
Payment may be made in full or in monthly instalments, with 50 percent paid upfront.
The balance must be settled within four years, before the insured individual reaches the age of 60 or before their service ends, whichever comes first.
Each monthly instalment must be at least 25 percent of the contribution account salary.
Applicants must be actively employed when applying.
If their service ends before payment is completed, the additional service period will be adjusted based on the amount paid.
In the event of death, any outstanding instalments will be deducted from the pensions of eligible beneficiaries in accordance with applicable laws.
Insured individuals should check which pension law applies to them, consider the impact of purchasing additional service years on their pension, and review the "Purchase of a Nominal Service Period" service card on GPSSA's website before applying.
