Pension reform in the Czech Republic has already begun, but the changes will be implemented over several years. Find out what the key features will be in this country and how they will affect foreigners, including Ukrainians

Legal advice for Ukrainians

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The Czech Republic is actively preparing a pension reform that will start in October 2024 and be completed by 2035. The main changes will affect the pension system, which will affect everyone, including Ukrainian refugees who legally reside and work in the country. With reference to Radio Prague International, we explain what this means and how to prepare for the changes.

The main reasons for the reform

The Czech Republic has a solidarity pension system similar to Ukraine's, where working citizens provide pensions for current pensioners. However, rising life expectancy and an increase in the number of pensioners have put additional pressure on the system. This has led to a financial deficit that reached a record CZK 73 billion (about 1% of GDP) in 2023. Without reform, this deficit will reach 5% of GDP by 2050.

The key factors behind the need for change are:

- Low economic growth.

- Deficit of pension funds.

- High inflation.

- Ageing of the population.

Key changes to the pension system

Starting from October 2024, 40 years of service will be required for early retirement (instead of the current 35 years). Periods of study will only count for 80%. The retirement age is also expected to gradually increase, linked to life expectancy, starting with citizens born in 1966 and later.

From 2026 onwards, new pensions will grow more slowly: the growth rate will decline by 8% over 10 years. However, the minimum pension will increase to 20% of the average salary, subject to a minimum length of service.

This year, new conditions for receiving state aid and tax benefits for pension savings were introduced, including an increase in minimum contributions and the minimum savings period.

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What does this mean for Ukrainian refugees?

Ukrainian citizens who are legally employed in the Czech Republic and pay taxes are entitled to pension benefits on an equal footing with Czechs. To receive a pension, two conditions must be met: having a sufficient length of service and reaching retirement age. In particular, Ukrainian employees can apply for a Czech pension if they have 35 years of service and are 65 years of age.

If the length of service in the Czech Republic is less than 35 years, the pension will still be granted, but with consideration of contributions made in the country. At the same time, the Czech social security authorities will apply to the Ukrainian Pension Fund to confirm the length of service gained in the home country.

It is important to remember that the Ukrainian pension is paid separately from the Czech pension and can be transferred to a Ukrainian bank account.

Practical advice

For Ukrainians living and working in the Czech Republic, it is important to

▪️ Pay social security contributions on time.

▪️ Keep all documents confirming employment.

▪️ Follow the changes in legislation.

The new rules will affect your pension savings, so you should consult with experts and take future changes into account in your plans. Please note that you can contact our lawyers if you have any questions about migration issues. 

We remind you! The Czech Republic remains an interesting and popular destination for emigration among Ukrainians and other foreigners, as the standard of living in the Czech Republic remains high and the costs can be lower than in most Western European countries. On our portal you can find up-to-date information on the prices of living in the Czech Republic in 2024-2025.