How to Calculate Insurance Overpayment for Late Retirement

Pursuant to the provisions of Clause 2, Article 56 of the Social Insurance Law 2014:

From January 1, 2018, the monthly pension of workers who meet the conditions stipulated in Article 54 of this Law is calculated at 45% of the average monthly salary on which social insurance premiums are based, as stipulated in Article 62 of this Law, and is proportional to the years of social insurance contributions as follows:

- For male workers retiring in 2018, it is 16 years; in 2019, it is 17 years; in 2020, it is 18 years; in 2021, it is 19 years; and from 2022 onwards, it is 20 years;

- For female workers retiring from 2018 onwards, it is 15 years.

After that, for each additional year, the workers stipulated in points (a) and (b) of this clause are calculated an additional 2%; the maximum rate is 75%.

According to the information you provided, it does not specify whether you are a male or female worker. Therefore, we address your issue under two scenarios for retirement in 2021:

First, for female workers:

- Female workers with 15 years of contributions will receive 45% of the pension; for each additional year, they are added 2% up to a maximum of 75%.

- At this point, female workers will need to contribute 30 years of social insurance to receive 75% of the pension => If you have contributed 34 years => you are entitled to 75% of the pension + 4 extra contributed years to receive a one-time allowance upon retirement.

- The one-time allowance for the 4 extra contributed years will be calculated as 2 months of the average monthly salary on which social insurance premiums were based. (Article 58 of the Social Insurance Law 2014).

Second, for male workers:

- Male workers with 19 years of contributions will receive 45% of the pension; for each additional year, they are added 2% up to a maximum of 75%.

- At this point, male workers will need to contribute 34 years of social insurance to receive 75% of the pension => If you have contributed 34 years => you are entitled to 75% of the pension. In this case, the years of social insurance contributions are just enough to receive 75% of the pension and thus are not eligible for a one-time allowance upon retirement.

Based on the above calculation, compare it with your situation to determine whether you are eligible for a one-time allowance upon retirement.

Sincerely!