NETHERLANDS - The mandatory choice between the savings scheme ‘spaarloon’ and the new ‘levensloop’, or life course, scheme will be postponed until July 1, the Dutch parliament has decided.
“People who have already paid into their spaarloon scheme can review their decision during the first half year of 2006,” the department of Social Affairs has announced. “The banks must return the money to the employer before July 1. The company in turn must pay the amount as salary,” it added.
In the original plans, employees need to make their decision to participating in which scheme every year before January 1.
The national consumers’ association, Consumentenbond, has however pleaded in favour of a delay this time. “People won’t know yet the financial effects of the new national health care scheme before the end of January, when they get their salaries,” it argued.
The Christian Democrats and the labour party PvdA were the driving forces behind the delay. According to them, there are too many obscurities in the implementation of the levensloop.
In many cases employers and employees still need to agree on levensloop schemes in collective labour agreements, or CAO’s. Moreover, pension funds and insurers must start offering levensloop schemes, they said.
The new tax-friendly levensloop scheme - meant to discourage early retirement - allows workers to save for unpaid leave, including early retirement.
Employees can save tax-free a maximum of 210% of their salary. This is 2.1 years of their full income, or 3 years of 70% of their wages. Employees of over 50 have extra allowances. A limited tax will be deducted when leave is being taken.
As of 2006, the present early retirement scheme VUT and prepension schemes will loose their tax benefits. The present tax-free savings scheme spaarloon will continue.