Getting a German pension refund after Brexit: A guide to the key changes

Brexit has had a significant impact on how citizens and residents of the UK can get their German pension refunds. Before Brexit, UK nationals had the same pension rights as other European Union citizens. However, since Brexit, the rules have changed, altering who can claim a refund and under what conditions.

If you are a UK citizen or a non-British UK resident, this guide will help you understand if you can get a refund from the German pension system. It will cover the latest changes, who can apply, and how to claim your pension money.

Understanding the German pension refund system

Germany has a compulsory pension system (Deutsche Rentenversicherung or DRV) where employed residents have to pay 9,3 percent of their gross salary to the German pension insurance. Those contributions are then used to finance ‌pension payments for people who are currently retired.

However, for those who leave Germany before reaching retirement age, there are specific conditions under which pension contributions may be refunded.

Who is eligible

Under German law, pension contributions can be refunded if:

• The person isn’t an EU citizen
• The individual has already left Germany and no longer works or lives in an EU country or the UK
• 24 months have passed since the person's last contribution

Not everything paid into the pension system can be refunded. Here's how pension refunds work:

• Only employee contributions are refunded - employer contributions are not included.
• Refunds are paid as a lump sum and may be subject to taxation in the country where you currently live.

Brexit's impact on pension refund eligibility

Many people assume that Brexit turned UK citizens into non-EU citizens for pension purposes, and that refunds are therefore now possible. In practice, that is not the case.

A German pension refund is only possible if you no longer have the legal right to pay voluntary contributions into the German pension system. It does not matter whether you would ever use that right; if the law keeps it open, the refund is blocked. Two post-Brexit agreements keep exactly this right open:

• The Withdrawal Agreement preserves the legal position of anyone whose cross-border situation existed before January 1, 2021. Even a single German contribution month before that date keeps the voluntary insurance right and blocks a refund.
• The EU-UK Trade and Cooperation Agreement governs situations starting from 2021 onwards, and its social security protocol preserves the voluntary insurance right for UK nationals worldwide. So even UK citizens who first worked in Germany after Brexit generally cannot claim a refund before retirement age.

Rules for UK citizens after Brexit

UK citizens generally cannot claim a German pension refund before reaching German retirement age regardless of where they live or when they worked in Germany. Their contributions are not lost: they count towards a German pension at retirement age, and a contribution refund at retirement age is possible if no pension entitlement exists by then.

Rules for UK residents of any nationality

A refund is also not possible for anyone currently living in the United Kingdom, whatever their citizenship. Living in the UK keeps the voluntary contribution right open under the post-Brexit framework. However, this is a residence question, not a permanent bar: non-UK nationals who later move outside the EU and the UK can become eligible under the normal rules for their nationality.

How to claim your German pension refund

The process to claim your German pension refund requires you to submit an application, with a host of supporting documents.

Required documents and application process

To claim your pension refund, you will need to present the following documents:

• Completed application form
• Copy of passport or other official identification
• Proof of deregistration from Germany
• Proof of residence outside Germany (such as a utility bill, tax statement or residence permit)
• German social security number (Rentenversicherungsnummer)
• Bank account details (for receiving the refund)

After you have all your documents ready, you can take the stress out of sending your application to DRV by using a third party to check and submit your application. They will check your documents carefully to make sure everything is correct and complete to avoid unnecessary delays. This way, you can be sure your application will be sent smoothly and without any errors!

The timeline for refund processing

The refund process follows this general timeline:

1. 24-month waiting period: Refunds can only be processed after two years have passed since the last pension payment in Germany.
2. Application submission: Ensure all documents are complete to avoid delays.
3. Review and approval: The DRV reviews applications, which can take several months.
4. Payout: Once approved, the refund is transferred within 10 working days.

How long it takes to process may change depending on how many applications DRV gets and how complex each case is.