Chapter VI: Old-age Chapter VI: Old-age
Applicable statutory basisO.M. 18.1.1967.
Legislative Royal Decree 1/94 of 20 June 1994, which adopts the amended text of the General Law on Social Security (Ley General de la Seguridad Social).
Royal Decree 1647/1997 of 31 October.
Basic principlesInsurance system.
Benefits (Jubilación) depend on contributions.
Field of applicationCompulsory insurance for all employees.
Exemptions from compulsory insuranceAll salaried work which is considered marginal and not a basic means to earn one's living because of the number of hours worked and of the wage paid are exempted from compulsory insurance.
ConditionsContributions must have been paid during a period of 15 years of which at least 2 years must have been during the 15 years immediately preceding the event which gives the right to entitlement.
To obtain a full rate pension (Jubilación the contribution period must have been 35 years.
Standard pension
65 years.
Early pension
As a transitory measure and in order to guarantee the vested rights, the persons insured according to the system abolished on 1 January 1967 have the possibility of retiring at 60 years of age.
The age of 65 years can also be reduced for certain groups whose professional activity is arduous, toxic, dangerous or unhealthy.
Deferred pension
The insured person can continue to work after the legal retirement age. As a general rule, there is no upper age limit except when such a limit is stipulated in a collective agreement.
BenefitsThe pension (Jubilación) amount is determined on the basis of contributions which in turn depends on the earnings and on the number of contribution years.
The amount of the pension (Jubilación) is obtained by applying a percentage to the statutory basis (see below under "Reference earnings or calculation basis"), the percentage corresponding to the number of contribution years the worker can prove according to a scale ranging from 50% for 15 years of contributions to 100% for 35 years of contributions, plus 3% supplement per additional year of contributions between the 16th and 25th year, and 2% supplement per year starting from the 26th year.
The statutory basis which serves as a reference results from the division by 210 of the pensionable wages of the concerned person during the 180 months preceding the event which gives entitlement. The 156 months of contributions which are the most remote from the date of entitlement are adjusted in line with consumer price trends between the month in question and that 25 months from retirement.
Annual wage ceiling: ESP 4,135,446 (EUR 24,855).
The first year of parental leave (Excendencia por cuidado de hijo) to bring up a child under three years is considered to be a period of effective contributions.
Spouse
The pension (Jubilación) is not increased as a general rule when the spouse is dependent. Only the amount of the minimum pensions (pensión minima) which is legally fixed is to be increased when there is a dependent spouse.
Children
No increase of the retirement pension (Jubilación) for children.
Two supplementary payments in an amount which is equal to the monthly amount of the pension automatically attributed each year.
Minimum pension (Pensión minima):
+ 65 years: ESP 56,990 (EUR 343) per month (14 payments per year) or ESP 67,050 (EUR 403) per month with dependent spouse.
- 65 years: ESP 49,735 (EUR 299) per month (14 payments per year) or ESP 58,690 (EUR 353) per month with dependent spouse.
Maximum pension:
ESP 295,389 (EUR 1,775) per month.
A reduction of 8% for every anticipated retirement year is applied to the persons insured according to the system which was abolished on 1 January 1967 and who retire at the age of 60 years. In this case, when these are workers who have contributed at least 40 years and whose anticipated retirement is not done on a voluntary basis, the reduction is 7%.
The insured person may continue to work after the legal age of retirement, but his pension is suspended. In this case, the rate which is applied to the statutory basis for calculation is increased by 2% for each additional working year up to 100% of the statutory basis for calculation.
AdjustmentAutomatic adjustment at the beginning of each year according to the consumer price index which was forecast for the year.
Partial pensionAccess to a part-time retirement (Jubilación parcial) is possible from the age of 60. The worker who receives a pension receives 50% of the pension he would be entitled to at the age of 65 and works simultaneously part-time in an enterprise.
Accumulation with earningsFull retirement: the payment of the pension is suspended if a paid professional activity is pursued.
Part-time retirement: a pension may be accumulated for the worker as part-time pensioner with the salary paid for part-time work.
Taxation and social contributionsThese benefits are fully taxable.
The limit varies annually according to the incomes and family circumstances.
None.