Pension Funds

  • All workers must pay into a pension fund, which is paid out at retirement age.
  • The general rule is that the premium paid into a pension fund or reversionary annuity is 10% of the total salary package. The employee pays 4% of that amount, and the employer pays the additional 6%.
  • Some pension funds reimburse none-EEA/EFTA citizens a part of  what they have paid if they migrate from Iceland.
  • The aim of these savings options, and pension funds are to ensure compensation to retired persons, those disabled during employment, and life insurance survivor's benefits for children and spouses.
  • Pension funds pay retirement pension in proportion to fees paid during ones working live.