Lithuania: New Directive on supplementary pension rights is probably the first incentive to overcome free movement-related problems.
Free movement of persons and free movement of capital are among the basic freedoms established in the Treaty on the Functioning of the European Union. Free movement of persons should be understood as a right to seek opportunities, apply for positions and accept employment offers not only in one’s home or resident state, but also in other European Union (EU) member states.
On 16 April 2014 the European Parliament and the Council adopted Directive No. 2014/50/EU on minimum requirements for enhancing workers’ mobility between Member States by improving the acquisition and preservation of supplementary pension rights (Directive). Adoption of the Directive is probably the first incentive to overcome free movement-related problems, whereas up to now the only possibility has been for individuals employed in another EU member state to take their statutory but not supplementary pension rights with them when they move.
Once the Directive is implemented, employees with supplementary pension rights, who wish to move to another EU member state will be able to maintain those rights, on certain conditions, in the relocation state’s social security system. A supplementary pension right should be understood as an occupational retirement pension scheme established under national law and practice, linked to employment and intended to provide a supplementary pension. The Directive should be adopted into national law no later than 21 May 2018.
If you have any questions regarding employment within several EU member states on issues such as pension and taxation or free movement as such, feel free to contact us.
Virginija Guleva Yvonne Goldammer
Tax consultant Partner