Czech Republic Agreement and foreign pension information 106-04012000

In the Czech Republic, the pension insurance legislation requires the compulsory payment of contributions on behalf of employees, usually through deductions from paid employment. Insurance also applies to the self-employed.

Contributions insure individuals against disability and death and provides for income in the form of a pension once the person reaches retirement age.

Sickness and unemployment are covered by further legislation and there is a non-contributory scheme covering social payments for those with low income.

The legislation is the responsibility of the Czech government but administration and payment of pensions under is the responsibility of a centralised government administration.

The Agreement with the Czech Republic started on 1 July 2011. There are no previous versions.

For Australia:

Department of Social Services (DSS)

For the Czech Republic:

Ministerstvo Práce a Sociálních Věcí (MPSV) - Ministry of Labour and Social Affairs

For Australia:

Services Australia

Note: the Australian Taxation Office (ATO) is responsible for double coverage provisions.

For the Czech Republic:

Česká Správa Sociálního Zabezpečení (ČSSZ) - Czech Social Security Administration (CSSA)

Regional Social Security Administrations (ÚSSZ) – regional administrative body

For Australia:

Centrelink International Services (CIS)

Note: the Australian Taxation Office (ATO) is responsible for double coverage provisions.

For the Czech Republic:

District Social Security Administrations (OSSZ)

Under the Agreement with the Czech Republic, information held about customers may be exchanged between the liaison agencies to determine entitlement to payments under the Agreement and under either country's domestic legislation (Article 19.1).

For information on bulk data exchange, see International Data Exchange Program and auto-indexation of foreign pensions.

The following liaison form is completed by Centrelink International Services (CIS) and sent to the Czech Republic:

• AUS187CZ - Australia/Czech Republic Agreement on Social Security

For help with creating and completing the liaison form, see Agreement liaisons, NZ CICs and exchange of information.

The following forms are completed by the Czech Republic and are sent to Centrelink International Services (CIS).

TRANSMITTAL/REQUEST/ERTIFICATION FORM - FORMULÁŘ PRO KOMUNIKACI/DOŽÁDÁNÍ/POTVRZENÍ (CZ/AU 001)

This form is used in all communication from the Czech Republic.

• Section 1 - INFORMACE O ŽÁDOSTI/INFORMATION ABOUT THE CLAIM: this section provides details of the applicant and insured person
• Section 2 - POTVRZENÍ ÚDAJŮ / CERTIFICATION OF DATA: this section confirms personal details ad verification
• Section 3 - POSKYTNUTÉ INFORMACE/INFORMATION PROVIDED
• Section 4 - POTŘEBNÉ INFORMACE/INFORMATION NEEDED
• Section 5 - POZNÁMKY/REMARKS

INSURANCE PERIODS CERTIFICATE - POTVRZENÍ O DOBĚ POJIŠTĚNÍ (CZ/AU 205)

• Provides details of creditable periods in the Czech Republic.

For Australia, the Agreement only covers Age Pension so medical information is not required.

However, the Agreement covers Czech Disability Pensions and the Administrative Arrangements include provisions for existing Australian information to be provided to Czech Republic on request.

Medical examinations may also be undertaken upon request for foreign pension claim purpose. Generally, the liaison agency will contact Services Australia with the request. There is no provision for reimbursement of costs to either country.

The customer should contact Services Australia if they receive a direct request from the liaison agency to undertake a medical examination. Advise the customer to go through Services Australia’s foreign pension medical assessment process. Where the customer has already undertaken a medical examination based on a direct request from the Agreement partner without consulting Services Australia, the customer should contact the liaison agency to discuss any possible reimbursement options.

If a customer is claiming reimbursement of costs based on undertaking a medical examination requested by Services Australia for foreign pension purpose, consider all evidence provided. For example, if incorrect advice was provided to the customer by Services Australia that caused them to seek an independent medical examination which caused the customer to be out of pocket.

See Customer compensation and Act of Grace.

See Agreement Country Document Catalogue (ACDC) for sample of forms, foreign documents and translations.

The Agreement with the Czech Republic includes double coverage provisions. Certificates of coverage are used to confirm exemptions.

Any enquiries about double coverage or certificates of coverage should be directed to the Australian Taxation Office (ATO) website.

Any queries about taxation of pensions or the requirement to lodge a tax return should be directed to:

• In the other country - the tax authority in that country
• In Australia - the Australian Taxation Office (ATO) website

See general information on taxation, including issuing Australian payment summaries.

Tax treaty

Australia has a double tax agreement with the Czech Republic, which avoids the need for the customer to pay tax in both countries.

A person who is 'resident' in one country (according to the definition in the tax agreement) generally only pays tax on pensions in that country.

Tax deductions from income by one country may be allowed as a credit against tax payable in the other country.

Tax deductions

Czech pensions are not taxed at the source.

Czech tax year

Czech Republic uses the calendar year (1 January - 31 December) as the tax year.

Australia does not have a Reciprocal Health Care Agreement (RHCA) with the Czech Republic.

See general information on health insurance and Medicare coverage.

Any queries about:

• Health insurance coverage in the other country – tell the customer to contact the health insurance authority in the other country
• Medicare coverage - direct them to Medicare

The official language of the Czech Republic is Czech.

See Czech naming conventions and pronunciation.

• Family names usually differ for males and females in the Czech Republic. In the Czech language the ending –ova is added to the male form of the family name to create the feminine form. For example: Novak + ova = Novakova
• Czech family names for males that end in ‘sky’ and ‘ny’ (for example: Slansky, Novotny) have female equivalents: ‘ska’ and ‘na’ (Slanska, Novotna)
• Customer’s Czech Name at Birth (NAB) and/or Maiden Name (MDN) are to be recorded on the Customer Personal Detail Summary (CPDS) screen for female customers

Telephone country code is +420

Czech Republic is the official name of the country and Czechia is the short form equivalent.

Street Address:

Title FirstName Surname [Addressee]

Prujezdna 320/62 [Street name + building number/street number]

100 00 PRAHA 10 [Postcode + delivery post office]

CZECH REPUBLIC

Street Address (where the locality does not have its own delivery post office):

Title FirstName Surname [Addressee]

Ladova 3/64 [Street name + building number/street number]

Hrusice [Name of locality without delivery post office]

251 66 SENOHRABY [Postcode + delivery post office]

CZECH REPUBLIC

Rural Address/Non-Street Address:

Title FirstName Surname [Addressee]

č. p. 8 [č p.+ building number]

378 07 RAPŠACH [Postcode + delivery post office]

CZECH REPUBLIC

Post Office Box Address:

FirstName Surname [Surname [Addressee]

Poštovní přihrádka 87 [P.O Box + number]

530 87 PARDUBICE 2 [Postcode + delivery post office]

CZECH REPUBLIC

Note:

• Post codes are 5 digits with a space between 3rd and 4th digit. Larger cities may also have one, two or three digits after the delivery post offices. E.g. PRAHA 102
• The street number often consists of two numbers separated by a slash:
• The first is the číslo popisné (č.p.) (building number), a land registry number with each building within a district having a unique number
• The second is the building’s street number: číslo orientační (č.o.) showing its street address

Czechoslovakia dissolved into the Czech Republic and Slovak Republic on 1 January 1993.

Entitlement to a pension is based on in which country the person’s last employer was registered. Where necessary, claims sent to the Czech Republic will be sent to the Slovak Republic authorities.

Same-sex marriage is not legal in the Czech Republic. The Czech Republic has offered registered partnerships for same-sex couples since 1 July 2006. Registered partnerships grant several of the rights of marriage, including inheritance, the right to declare a same-sex partner as next of kin, hospital visitation rights, jail and prison visitation rights, spousal privilege, and alimony rights, but do not allow joint adoption, widow's pension, or joint property rights.

For Australia, the Agreement with the Czech Republic (Article 2.1) covers:

• Age Pension

Claims for Australian payments under International Agreements use the same methods and processes as domestic claims.

Forms to claim an Australian payment in Czech Republic can be obtained by:

• downloading the relevant form from the Services Australia website. See Resources
• contacting Centrelink International Services (CIS)
• contacting the Czech authorities

Australian forms needed

The customer is to complete and provide the following:

All claims:

• AUS140CZ - Australian Pension Claim – Social Security Agreement between Australia and the Czech Republic
• Mod(iA)CZ - Income and Assets - Czech Republic

Forms can be lodged at any Czech social security office.

Under Section 7 and 8 of the Administrative Arrangements, the Czech institutions will:

• accept all forms/documents and date stamp the AUS140 form
• verify the customer’s identity and personal details, and
• send the form(s) and any supporting documentation to Services Australia with a liaison form specifying periods of coverage in the Czech Republic and information regarding Czech pension

See Exchange of information and liaison forms.

If a person is not an Australian resident and in Australia on the date the claim is made, they may use the Agreement to meet the residence rules for claims if, on that date, they are:

• an Australian resident, a resident of the Czech Republic or another Agreement country that accepts claims for Australian pension under another agreement ((Article 10(a)), and
• physically present in Australia, the Czech Republic or that third country (Article 10(b))

Claims under the Czech Agreement

Claims for Australian payments under the Czech Agreement may be lodged in certain other Australian Agreement countries.

See the Claim lodgement matrix.

Accepting other Agreement claims

Czech Republic will not accept claims for Australian benefits under other Australian social security agreements.

Claim lodgement consideration

There are no specific considerations under the Czech Agreement.

The normal rules for working out the date a claim is 'made' and the start day apply to claims under the Agreement with the Czech Republic. However, the Agreement also allows:

• the date of lodgement of a claim for an Australian payment in Czech Republic to be used as the date of lodgement in Australia (Article 16.2), or
• the date of lodgement of a claim for Czech Old Age Pension as the date of lodgement for Australian Age Pension (FP claim + Au claim) if:
• the customer declared an affiliation with the Australian legislation and
• the claim for Australian pension is received within 12 months of the lodgement of the Czech claim (Article 16.3)

For coding help, see:

• Claims for Australian payments under International Agreements) and
• Start Day (CLK)

The Agreement allows:

• totalisation of periods of qualifying Australian residence and periods of coverage in Czech Republic to meet any minimum periods to qualify for an Australian pension, for example, 10 years for Age Pension (Article 11.1)
• the total of any non-continuous periods of coverage in Czech Republic to be considered to be continuous to meet any continuous residence requirements (Article 11.2)

Note:

• Overlapping Australian residence and Czech periods of coverage are only counted once (Article 11.3)
• Adjoining periods of Australian qualifying residence and periods of coverage in Czech Republic, with a break of up to 3 months in between, can also be considered to be continuous (Policy)

See Resources in International Social Security Agreements for examples of totalisation

Czech period of coverage:

• means a creditable period, for instance a period during which contributions were paid, or any equivalent period, as defined in the Czech legislation
• where equivalent periods may include deemed periods such as for studying, child rearing or military service
• where both actual and deemed periods may be used when totalising for Australian qualification purposes, as long as they are certified, and don’t overlap
• must be certified by the Czech Competent Institution

To be able to use the totalisation provisions, a person who is not an Australian resident at the date of lodgement must have at least 12 months Australian Working Life Residence (WLR) in Australia of which 6 months must be continuous (Article 11.4(a)).

Note: unlike WLR for rate, this period cannot be rounded.

No minimum WLR is required if the person is an Australian resident at the date of lodgement (Article 11.4(b)).

Customers residing in the Czech Republic do not meet the ongoing residence requirement for DSP.

For customers outside Australia, the Agreement with the Czech Republic (Article 12.1) refers to the overall rate calculation contained in section 12(1) of the Social Security (International Agreements) Act 1999.

This means customers paid under the Agreement have:

• proportional rate paid according to their Australian Working Life Residence (WLR)
• the Rate Limiter/Limited Rate applied
• additional child amounts (s.14a SS(IA) 1999) included, if eligible

The Agreement with the Czech Republic does not include the proportionalisation of any Czech pension in the income test (Randisi concession).

Non-proportional rate extension

Customers paid under the Czech Agreement and temporarily outside Australia, cannot have their non-proportional portability rate extended if they are unable to return to Australia.

Returns to Australia

The proportional rate continues to apply for the first 26 weeks of a temporary return to Australia (Article 12.2).

will automatically apply the correct rate calculation.

• For returns to Australia before 9 June 2018, manually code Temporary Return to Aust Ind on the Residence Savings (RSS) screen.

Customers in Australia under the Agreement are generally paid a direct deduction rate (Article 12.3).

The Agreement does not include a comparison rate in Australia.

Departures from Australia

The inside Australia rate continues to be paid for the first 26 weeks of a temporary departure from Australia (Article 12.4).

Payments under the Agreement

Under the Agreement, provided the customer remains qualified, Australian payments are payable indefinitely in Australia or the Czech Republic (Article 5.1).

Third country portability under the Agreement

Portability to third countries for a customer paid under the Agreement is the same as for an autonomous customer leaving Australia (Article 5.2). See Portability of payments.

If necessary, a customer who receives an autonomous payment that stops being payable due to portability reasons can transfer to the Agreement to continue payment if the:

• payment is covered by the Agreement
• customer meets any payment limitations, such as severely disabled, and
• customer is able to meet the lodgement provisions of the Agreement

If transferred to the Agreement, all Agreement rules apply to the customer, including portability and rate of payment. See Transfer to international social security agreements.

A person who would be autonomously qualified but is paid under the Agreement can transfer from the Agreement to autonomous only if they are an Australian resident and in Australia.

On return to Australia, system processing will automatically transfer to from the Agreement to autonomous if the person is an Australian resident who has only used the Agreement to extend their portability while outside Australia.

Former resident provisions may affect customers who transfer to autonomous if they leave Australia again within 2 years of becoming an Australian resident.

Australian payments may be issued to customers outside of Australia. If the customer intends to be outside of Australia:

• long-term (12 months or longer), their Australian payment may be issued to an overseas bank account. See Overseas Bank Account Details (OBAD) for payment requirements by country
• for less than 12 months, payment will generally continue to their normal Australian bank account every 2 weeks

See Delivery of payments to Centrelink customers outside Australia.

For the Czech Republic, the Agreement covers the Pension Insurance Act.

Main payments

• Starobní důchody - Old Age Pension (AGE)
• Invalidní důchody - Disability Pension (INV)
• Pozůstalostní důchody - Survivors Pensions (SUR):
• Vdovský/Vdovecký (Widow/er)
• Sirotčí (Orphans)

Note: main payments consist of a percentage (procentní) and base rate (záklasní).

Supplementary payments/Allowances

• Příplatek k duchodu (Pension supplement)
• Zvláštní příspěvek k důchodu (Special pension contribution)

The following known payments are paid by the Czech authorities but are not covered under the Agreement:

• Restitution payment

For help with:

• Assessment of Czech pensions, see Assessment
• Coding of Czech pensions, see Eligibility and Coding

The requirement to claim Czech pensions applies to Czech AGE and INV.

• Customers may voluntarily claim Survivor pension and/or Orphans Benefit using the SUR claim pack

See Foreign pension claims.

Eligibility and coding for foreign pensions tab contains detailed information on Czech payments that are subject to CFP legislation.

Claim packs are available for AGE, INV and SUR.

Claim packs are issued through the Foreign Pension System (FPS). See Assisting customers to claim a foreign pension.

Specific requirements for Czech claims

The customer is to complete and provide the following:

All claims:

• CLAIM FOR A PENSION FROM THE CZECH REPUBLIC - ŽÁDOST O DŮCHOD Z ČESKÉ REPUBLIKY (CZ/AU 202)
• Birth certificate
• Evidence for substitute insurance periods (child-rearing, study, military service)

Note: income declaration is for the calendar year when claimed.

SUR only:

• Deceased's birth certificate
• Death certificate
• Marriage certificate

Requests for additional information

If information provided with the claim for a Czech pension is incomplete, the Czech Republic will send requests for information in Czech direct to customers.

Receipt of foreign pension claim by Services Australia

Under the Administrative Arrangements, the Czech Republic forms can be lodged in Australia at any service centre. See Processing a foreign pension claim.

• All foreign pension claims and supporting documentation must be scanned, and
• The original foreign claim form and copies of supporting documentation must be sent in paper form to Centrelink International Services (CIS). See Processing a foreign pension claim

Centrelink International Services (CIS) only:

CIS will complete the following or arrange for the following to be completed as necessary and attach the documents to the foreign pension claim to send to the agreement country. See Agreement Liaison Detail (ALD) for method of transmission.

All claims:

• AUS187CZ - Australia/Czech Republic Agreement on Social

For help with creating and completing the liaison form, see Agreement liaisons, NZ CICs and exchange of information.

INV only:

• E213 - Detailed Medical Report. See Foreign pension medical assessments
• Copy of existing Australian medical information

Enquiries regarding claims for Czech payments in Czech Republic should be directed to the Czech social security authorities.

Based on the customer’s chosen Czech life certificate certification cycle, the Czech pension will be paid for the preceding period for that frequency.

Czech Republic payments may be paid by direct deposit in Australia via the Czech National Bank.

Any queries about the non-payment of Czech pension should be directed to the Czech pension authorities.

Agreement pensions are paid as 12 regular monthly payments. There are no bonus payments.

Other benefits or private pensions are paid monthly or annually.

Czech pensions must be recorded in the source currency - Czech Koruna (CZK). Official statements provide the foreign currency amounts.

Amounts recorded in source currency on the Foreign Pensions Details (FPD) screen must not be changed to the Australian dollar amount.

Note: payments into Australia are paid in Australian dollars.

Czech pensions are generally increased for Consumer Price Index (CPI or cost of living) changes from 1 January each year.

Ad hoc increases may also be made to all Czech pensions paid from the Czech social security system. Increases occurred in June 2022, September 2022 and June 2023.

A pension certificate needs to be requested before updating the Czech pension rate.

Some foreign pensions recorded are automatically adjusted for CPI increases. See International Data Exchange Program and auto-indexation of foreign pensions.

• directly deducted (Article 12.3) and ignored in the income test (Section 8(8)(zc) Social Security Act 1991) for customers under the Czech Agreement who are in Australia
• ordinary income (not proportionalised) for customers paid:
• under the Czech Agreement who are outside Australia
• autonomously inside or outside Australia
• under an agreement other than the Czech Republic or New Zealand who are inside or outside Australia

See Rate Calculation for when a direct deduction or proportional rate is applied.

Note: each member of a couple is deemed to receive half of the total amount received by the couple (Article 12.5).

• Příplatek k duchodu - Pension supplement

Příplatek k duchodu was introduced to help alleviate grievances caused by the communist regime for political prisoners.

These payments are exempt under the income test for customers paid under the Agreement or autonomously:

• Restitution payment

Restitution payment paid for National Socialist (Nazi) persecution is assessed as exempt income (s8(8)(n) Social Security Act 1991). Otherwise, it is assessed as ordinary income.

• Zvláštní příspěvek k důchodu - Special pension contribution
  Zvláštní příspěvek k důchodu may be paid to a person who:
• participated in the resistance during World War II
• participated in the May 1945 uprising
• was a political prisoner and was rehabilitated

Payment may be made to surviving widow or widower.

This payment can be paid to a person residing in the Czech Republic or outside of the country.

The special pension allowance is:

• paid monthly together with the Czech pension
• indexed according to special regulation, independently of the pension and other pension supplement increases

If the special contribution is paid due to National Socialist (Nazi) persecution, (Czech law 357/2005) it is exempt. Otherwise, it is assessed the same as the main agreement pension.

The Agreement does not include embargo provisions.

Arrears debts for customers and partners are raised under s1228A Social Security Act 1991 and recovered via normal methods under the Act. See Comparable Foreign Payment (CFP) lump sum arrears debts.

When an arrears period is not provided, the arrears period end date may be assumed to be the end of the month before the date on the notice or liaison form.

A contravention debt may also occur if the customer does not advise of the grant of their Czech payment within their notification period. See Foreign Pension coding.

Life certificates (Certificate of Living - POTVRZENÍ O ŽITÍ) are required when a customer claims for a Czech pension and while in receipt of a Czech pension

Customers can choose to provide their Czech life certificate:

• quarterly
• six-monthly
• annually

The Czech pension will be paid for the preceding period at the same frequency chosen by the customer. Customers who choose to provide a certified life certificate:

• every quarter - will receive their previous 3 Czech pension payments once every quarter
• six-monthly - will received their previous 6 Czech pension payments once every 6 months
• annually - will receive their previous 12 Czech pension payments once a year

Customers are to liaise with ČZZS if they want to change the frequency they receive their life certificate (and payments).

Czech Life Certificates can be certified by an officer of Services Australia.

For information about helping customers with life certificates, see Assisting customers to maintain and existing foreign pension.

Customers in Australia are sent notices at grant and for changes of rate for example, indexation.