What you need to know

PayPal’s pension plan is available to all employees starting day one of your employment. PayPal covers the cost of the plan, unless you choose to make your own contributions. The pension plan provider is Swiss Life (Luxembourg) S.A.

What is a pension plan?

A pension plan allows money to be put aside now for your retirement later. It’s a long-term investment option that grows as you continue with PayPal, so you have a pension fund — or certain amount of money — available to you when you retire.

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How it works

PayPal will automatically contribute according to the following formula: 3% x R1+11% x R2.

R1 equals your annual salary up to the social security ceiling (€128.519 as of January 2020). R2 equals the portion of your salary above the social security ceiling. You do not need to take any action for the employer’s contribution.

On top of the employer’s contribution, you can decide to make personal contributions. By law, personal contributions are capped to €1.200 per year. HR Hub will enroll you in the pension plan as soon as they receive your hiring pack containing the Swiss Life Application forms.

If you have further questions, please open an HR Hub ticket.

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Making personal contributions

Personal contributions are voluntary and do not affect the company’s contributions. If you choose to save your own money, you can contribute up to €100 per month, which will be deducted from your monthly salary. You can change your contribution amount at any time. Just keep in mind that the maximum tax-deductible amount is €1.200 per year and that a 2% charge applies on the contribution before investment (i.e., if your contribution is €100, your actual contribution will amount to €98).

If you didn’t opt to make individual contributions when you joined PayPal, please fill out the Swiss Life form to get started with personal contributions, and send it to HR Hub via a ticket. If you decide at a later date to change the amount of contributions, please fill out a new contribution form, and send it to HR Hub via a ticket. Contact HR Hub if you need the correct form. PayPal will notify payroll and the insurer once the form is received.

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What funds can I invest in?

You can invest employer’s contributions in different funds with different risk profiles. Depending on the currency used, you have different funds to invest in. Euros can be invested in the first 3 funds listed below: 

  • Swiss Guarantee EUR (product with guaranteed interest rate)
  • UBS (Lux) Strategy Fund – Yield (EUR)
  • UBS (Lux) Strategy Fund – Growth (EUR)
  • UBS (Lux) Strategy Fund – Balanced (USD)
  • UBS (Lux) Strategy Fund – Growth (USD) 

You can change the investment in the funds. However, please note that those changes will be made at your own cost.

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How do I access my Swiss Life account?

You can access your Swiss Life account online.

After you join PayPal, you will receive emails from Swiss Life with your username and password details. It may take 1 to 2 months to receive the email after your starting date.

In case you have lost your username and/or password, please use the dedicated Swiss Life website’s option “Forgot your username?” / “Forgot your password?” that is shown below the entry field. You will then receive instructions by email.

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When can I see the employer’s contribution?

The annual renewal takes place in May, based on census data available as of 1 April. PayPal will receive an invoice from Swiss Life, who will process the investment once the invoice has been paid. Once funds have been invested, you will be able to see the updated total employer’s contributions on your account balance.

If you have joined after 1 April, your account will show a zero, because you'll need to wait for the next annual renewal (i.e., May of the following year). At that time, Swiss Life will make calculations for the employer’s contributions dating back to your start date. Then the amount that will show up in your account will be the premium for the previous year plus the total contribution for the following year.

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When does PayPal’s contribution vest?

PayPal’s contributions to your retirement plan will vest once you have been working for 2 years and once all the following conditions are met:

  • If you leave PayPal within 2 years of commencing employment, no rights resulting from this Scheme will vest. You will lose all employer’s contributions accumulated during your service and will only get your personal contributions.
  • If you leave PayPal after completing at least 2 years of employment, you will be vested in PayPal’s contributions to the plan. You will get both employer and personal contributions.

Swiss Life will check the employment period and let you know if you have any vested rights. You will not be able to receive vested rights as long as you are employed by a PayPal Luxembourg entity.

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What happens if I leave?

Swiss Life will contact you directly once they receive a confirmation from the HR department concerning your exact leaving date. Swiss Life will inform you about the exact amount you are entitled to receive as well as the different options that you have (redemption of vested rights only under certain circumstances or transfer of vested rights in another pension scheme). PayPal is not responsible for the redemption/transfer of vested rights.

The redemption or transfer of vesting rights is not immediate and may take place a few weeks after your departure.

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How do I transfer the money from my other retirement savings plans to the PayPal pension plan?

Tell your previous employer that you'd like to transfer your retirement savings from your previous retirement plan to the PayPal/Swiss Life plan. Both your previous employer and PayPal will have to sign forms. Please open an HR Hub ticket to get the necessary documents signed.

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What are the applicable taxes?

Tax on contributions
  • Paid by the employer (20.9% on premiums and employer’s contributions).
Tax on benefits
  • Tax exemption on benefits (retirement / death / disability) for beneficiaries who live in Luxembourg because the front-end tax is paid by the employer.
  • Non-resident beneficiaries should refer to the tax rules applicable in their country of residence. These apply unless there is a treaty of non-double taxation.
  • Swiss Life communicates the amount of benefits within the framework of its regulatory obligations (SRC and FATCA).
Dependency Contribution
  • All benefits paid are subject to dependency contribution of 1.40%.
  • Deducted before payment.
Questions on taxation
  • Speak with your independent financial advisor if you have any questions regarding your pension and / or how it is taxed upon retirement.

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Provider contact information

Swiss Life (Luxembourg) S.A.