Occupational Pension,
the Tuleva Way

Life in Estonia gets better when more people actively save for their future. It means fewer people in financial trouble later, reducing the burden on our children. That’s our mission—and your company can help make it happen.

What is Occupational Pension?

It’s a simple but powerful tool to help your employees build a solid financial future. At the same time, it helps your company attract, motivate, and retain the best talent. Here’s how it works: if an employee contributes to their third-pillar pension fund, your company adds a little extra. For example, your company could contribute 2% of the employee’s gross salary if they save at least the same amount themselves.

Why Should You Offer Occupational Pension?

If the employer doesn’t help, employees won’t save. Decades of experience across many countries show this to be true.
You’re making a real difference in the society. Most Estonians don’t save enough for retirement. And with an aging population, financial insecurity in old age is becoming a growing problem. When companies step in and motivate employees to save, they do — this is a proven fact. For example, by contributing 2% to an employee’s pension fund if they do the same, you’re helping build a future where everyone has more security.
Your employees will thank you. Occupational pension shows you care about your team’s long-term well-being. It boosts loyalty, satisfaction, and motivation while reducing employee turnover.
Hiring becomes easier. Including an occupational pension in your benefits package makes your company stand out. It can be the deciding factor for top candidates, showing them that your company values its people and their future.

What’s in it for Employees?

It’s an easy way for them to build serious wealth. With tax benefits and your contribution, every €32 they save can turn into €80 in their pension fund. And this happens automatically—starting from the moment they join your team. Over time, even employees with an average salary can accumulate tens or even hundreds of thousands of euros.

How Does It Work?

Tax benefits. Contributions to the third-pillar pension are exempt from income tax up to 15% of gross income, but no more than €6,000 per year. Since occupational pension contributions are made before income tax calculation, employees receive the tax benefit immediately. They don’t need to wait for their tax return to reclaim the amount later.
Automatic investing. With occupational pension, employee contributions are deducted directly from their salary before it’s paid out. This means employees don’t have to worry about setting up or managing monthly payments. It simplifies saving and ensures employees build a more secure financial future. If their salary changes or stops, the contribution amount adjusts automatically.
Contribution matching. The employer contributes to the employee’s third-pillar fund alongside the employee. For example, the employer could match the employee’s contribution up to 2% of their gross salary.

How to Implement Occupational Pension in Your Company?

1Employer Decision

First, the employer should decide to offer occupational pension. This requires drafting and digitally signing a board resolution.

2Set Up Accounting

You’ll need to configure your accounting software, tax declarations, and payment system for pension contributions.

Accounting software. Add a new payroll item labeled “Occupational pension” in your payroll system. This helps track pension payments and simplifies tax reporting. Setup guides are available for software like Merit Palk and Rapid Palk.
Tax declaration. Declare third-pillar contributions under code 25 on Annex 1 of the TSD form. Guide for declaring occupational pension.
Pension payments. To streamline regular payments to employees’ pension accounts, set up designated payments in your company’s online banking system. This automates pension contributions and reduces the administrative burden. Guide for setting up payments.

3Employee Communication

Inform your employees about the occupational pension program before launching it. This could include:

An information session. Explain how the system works and how employees can start making contributions.
A summary email. Provide clear instructions and links for further information.
Activate employees’ pension accounts. Each individual has a personal pension account in the national pension registry managed by AS Pensionikeskus. Employees can activate their third-pillar account via the Tuleva website here.
Employee applications to the employer. Employees who wish to participate must submit an application specifying their desired contribution as a percentage of their gross salary. Sample application to the employer for making third-pillar contributions with occupational pension support is available.

4First Payroll with Occupational Pension

The first payday with occupational pension is a key milestone. Ensure all setups are in place, payments are made, and contributions are declared correctly.

Employees can see their occupational pension contributions and the status of their third-pillar savings on the Tuleva website.
If an employee wants to change their monthly contribution amount, they need to submit a new application to the employer.
Since occupational pension contributions are based on a percentage of gross salary, any salary increase automatically adjusts the contribution amount.

5Congratulations!

You’ve successfully launched an occupational pension program in your company, making a meaningful contribution to your employees’ financial well-being.

Companies like yours, who care about their people, are already leading the way by offering occupational pensions or direct third-pillar contributions from salaries: