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At the beginning of this year, there were about 1.37 million. of the population that has accumulated a pension in the second pillar funds, that is, about 80 percent. of all employees, announces the Lithuanian Pension and Investment Fund Association (LIPFA).
He estimates that the value of all his accumulated assets reached almost $ 4.5 billion. euros. Consequently, an accumulator had an average net worth of almost 3.3 thousand euros.
One of the incentives to accumulate a pension is the possibility of inheriting a property. However, much of it is not inherited and remains in pension funds.
How many really accumulated died
According to Sodra, approximately 4.1 thousand people were fired during the last year for the death of a participant of pension accumulation. Second pillar pension accumulation agreements. Obtains information about deceased accrual participants from fund managers approached by heirs to the deceased’s estate.
Statistics from Lithuania announce that 43 thousand people died in Lithuania last year. population. Of these, 9.7 thousand. he was of working age, between 20 and 64 years old.
If we assume that 80 percent. accumulated a pension in the funds, according to LIPFA, it turns out that last year 7.7 thousand died. Pension Accumulation Participants – Almost double what Sodra estimates based on information from fund managers.
Finally, if we assume that all deceased accumulation participants had an average accumulated amount, it will turn out that they left around 12 million in the funds. euros.
However, the LIPFA does not rule out that this amount may be higher, as there may be more deceased and abandoned fund participants or their accumulated amounts.
However, no one can say exactly how much, because the data of such persons is only corrected when requested by the heirs.
Is it not allowed by law or due to lack of desire?
Sodra constantly receives relevant data on deaths from the Population Registry. They are used to stop the payment of pensions and other benefits to the population, or to manage the part of employees transferred to the funds to accumulate wages.
Generally speaking, Sodra has enough data to terminate all pension accrual agreements, but does not use it.
Why not Saulius Jarmalis, the head of its Communication Department, explained the following:
Sodra has no right to report the death, as this is not his data, as is the administration of pension fund accounts. Notaries receive this information. Yes, there are such open accounts and, at the same time, unregistered shares. However, we cannot “take” such numbers with the available application tools. “
According to S. Jarmalis, the pension funds accumulated in the account are active, so it is subject to legislation that also defines inheritance.
“Accumulation agreements for pensions or participation in accumulation due to death are suspended only when personal accounts in the fund are closed. And they can only be closed when the heirs appear ”, explained the head of the department.
Heirs can appear after a long time.
LIPFA Director Tadas Gudaitis confirmed that Sodra does not provide information on the deaths of the participants; it only confirms the fact that the pension accumulation company provides information for the cancellation of the pension contract registration.
“The pension fund administrators obtain information on the death of a participant of a pension fund when their relatives, heirs, bailiffs and the State Tax Inspection (STI) request the company,” commented the head of the association.
According to him, there is no time limit on how long the accumulated assets of a deceased person can be kept in pension funds longer, if his heirs do not appear. However, it is said that they are natural persons or the State that takes over the inheritance.
According to T. Gudaitis, fund managers do not receive information about the deceased from the Population Registry because there is no legal basis for it.
“The legislation does not provide for any obligation or right to verify and obtain such data. Furthermore, if foreigners accumulate in pension funds, the Lithuanian Population Register may not have such data,” said the interviewee.
According to him, if the pension accumulation companies are not aware of the death of the accumulation, then their pension fund remains in the life cycle fund based on age in the general order. When companies receive information about the death of an accumulator, that participant’s funds are transferred to the Asset Preservation Fund.
“Pension funds accumulate additional funds for old age. It is like other financial assets, for example, a deposit in a bank, which is inherited in the general order ”, explained T. Gudaitis.
In his words, there may be a number of reasons why the heirs to the deceased person’s estate do not request and recover the assets accumulated in the funds.
“For example, they could refuse to accept an inheritance because the deceased left more debt than property. In this case, the funds left without the owner without death go to the state. There are cases when the heirs learn of the death of a loved one only after a few weeks or months.
By the way, the process of accepting the inheritance itself is not short, it can take several months or even several years ”, commented the director of LIPFA.
The asset preservation fund, to which the assets of the deceased are transferred, is intended to invest in assets with the lowest investment risk, which could protect accumulated pension assets from the risk of inflation. For this, accumulation companies do not apply more than 0.2 percent. deductions from the annual average value of the funds calculated in the participant’s pension account.
The Civil Code stipulates that the heir must accept the inheritance within 3 months from the date of the inheritance. Then it is necessary to ask the court for an extension of the term to accept the inheritance. The state receives pension assets only if it is the heir.
How much property the state inherits
Džiuginta Balčiūnienė, Senior Advisor to STI’s Non-Payments Administration Department, reported that if the deceased had no heirs either by law or by will, his personal property, as well as the funds from the pension funds, pass to the state by inheritance.
“In such cases, the property (funds) passes to the state not as homeless property, because the former owner of the property is known, but according to the certificate of inheritance rights issued by a notary.
Said document is issued by a notary after the STI, having gathered information about the deceased, his heirs, personal property and funds, requests the notary to issue a certificate of the right of inheritance ”, commented the advisor.
He noted that the real estate inherited by the state, as well as the shares of corporations and private limited companies, are inherited and managed by the Property Bank on behalf of the state.
“When the state inherits the property of the deceased pension fund participants, the notaries must indicate in the inheritance certificates, in addition to the mandatory information on the testator, the number of the pension account inherited from the state of the participant of the pension fund. pension deceased. The STI applies to the appropriate bank and requests that the funds of the deceased pension fund participant inherited by the state be transferred to the STI deposit account.
If a participant in a deceased pension fund has a creditor, the STI will settle accounts with the latter within the fair value of the inherited personal property transferred to the state at the time of sale or within the limits of the inherited funds. After an agreement with the testator’s creditors, the remaining funds are transferred to the budget, “noted D. Balčiūnienė.
According to STI estimates, last year the state inherited more than 111,000. pension fund assets. That is twice as much as in 2019.
Must be addressed by legal means
Marijus Kalesinskas, chairman of the board of the Association of Pension Fund Participants, was wary of the situation when deceased accumulators leave assets in the funds because no one inherits them.
“I know the situation only in more or less general terms.” We have not had to go further, and we have not discussed this issue separately in the association, because so far there have been no major problems, “said the interlocutor.
On the other hand, he questioned whether it was really true when the assets of the deceased were in the funds indefinitely.
“I would say that the situation should be resolved by legal means. If that mechanism still does not work, a solution should be sought. Apparently, the same” Sodra “could perform its function here – M. Kalesinskas considered.
According to him, in practice, when the deceased’s assets are recovered, everything usually happens as follows: the inheritance goes into effect and the heirs request payment from the fund administrators. This process is said to be going fairly quickly and smoothly so far so I haven’t heard of any major issues.
M. Kalesinskas agreed that it is partly beneficial for pension fund companies to manage the assets of the deceased for as long as possible, as they receive a fixed fee for it. Furthermore, obtaining data from the registration centers would generate additional costs for them.
On the other hand, receiving them would not solve the problem on its own, because if the property heirs do not appear themselves, it can also be difficult to find them.
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