Occupational pension (betriebliche Altersversorgung)

Level 2 · FoundationsDE · 2026 figures

German termbetriebliche Altersvorsorge (bAV)

Used byEmployer match — free money · Vesting

A betriebliche Altersversorgung (bAV, occupational pension) is an employer-linked promise covering old age, disability, or survivors under German occupational-pension law. Funding can come from the employer, Entgeltumwandlung (salary conversion), or both. The employer selects the arrangement within legal and collective-agreement constraints, while the plan documents determine benefits, costs, guarantees, and portability [1][2].

The decision frame

Employees generally have a statutory right to convert future salary up to 4% of the pension-insurance contribution ceiling, subject to tariff rules and implementation details. This is a right to salary conversion, not a universal right to a chosen provider or a large employer-funded pension [2].

Question	Why it matters
Who contributes?	A genuine employer contribution changes the economics
Is employee funding from gross or net pay?	Salary conversion affects current tax and social contributions
What are total costs and guarantees?	A large headline contribution can be weakened by fees
What happens after a job change?	Rights may stay, transfer, or continue under plan-specific rules
How are benefits taxed and charged later?	Deferred deductions change net retirement income
Does conversion reduce social-insurance earnings?	Lower covered pay can reduce statutory pension and some wage-linked benefits

Worked classification

An employee converts €200 gross monthly and the employer adds €30. The plan receives €230. That does not establish a 15% lifetime return. Compare the €30 contribution with fees, later deductions, investment or guarantee terms, reduced social-insurance accrual, and job-change rules.

This article is a map. ConceptMeta links to the detailed bAV article for 2026 limits, implementation routes, vesting, tax, and benefit mechanics.

Check yourself

Which sources can fund a bAV? Select all that apply.

Employer contributionsEmployee salary conversionA combination of bothGerman pension points transferred into the plan

What does the statutory salary-conversion right guarantee?

The employee's preferred provider and productA route to convert eligible future salary within legal limitsA large voluntary employer match

An employee converts €200 and the employer adds €30. How much enters the plan?

Which effects belong in a bAV evaluation? Select all that apply.

Fees and guaranteesLater tax and social chargesJob-change and portability rulesEmployer contribution only

The decision frame​

Worked classification​

Check yourself​

Sources​

The decision frame

Worked classification

Check yourself

Sources