No Membership in Statutory Old-Age Pension Scheme for Managing Directors of GmbH – Now with Statutory Regulation
The lawmaker, i.e. parliament, passed the Act to Accompany the Federal Budget 2006 and so to say “overruled” Bundessozialgericht (Federal Social Court) on membership of GmbH-Geschäftsführer (= managing directors) of November 24, 2005, in the statutory old-age pension scheme.
The Federal Social Court rendered a judgment (re AZ B 12 RA 1/04 R) raising much commotion in the business world. This judgment attempted to force all proprietors also functioning as managing directors of corporations like GmbH, Ltd, etc. by considering them an employee of their company into statutory old-age pension scheme. The dramatics about this is that paying into the statutory scheme will bring you at best only 1.3% of what you paid into the scheme. Private pension plans are much more profitable.
The new law is only a reflection of practice of the pension agencies. On the other hand, if your GmbH only consists of you, you have no personnel and only one major client, you will still be stuck to the statutory scheme – dummy entrepreneurship is the key word.
You will not automatically be subject to the statutory scheme for old-age security. This can happen after your next audit by the statutory old-age pension authority, Deutsche Rentenversicherung. The sword of Damocles, “being or not being subject to the statutory scheme” will be swinging above your head until it is time-barred (in German “Verjährung”) comes in. This will be three years after the claim has matured. If you want to be careful and rest assured, then apply for a status check (“Statusfeststellung”). After their clearing in accordance with §7 a SGB IV you will know for sure if you are really are a “member” of Deutsche Rentenversicherung or not.
When will the Deutsche Rentenversicherung audit you? Following §28 p SGB-IV, it occurs at least every four years. If you somehow arouse suspicion on your situation, expect their visit more often.