The Individual Pension Savings and Investment System Law no. 4632, which was prepared as part of the social security reform in our country and complements our public social security system, was published in the Official Gazette dated 7 April 2001 and numbered 24366 and entered into force six months after its publication.

The individual retirement savings and investment system is designed to increase the level of welfare by providing additional income in retirement periods by encouraging individuals to invest in their retirement savings, to increase the employment of the economy by contributing to long term resources and to contribute to economic development, to expanding the scope of social security, Is a private pension system that enables the development of institutional investors and the deepening of capital markets by increasing long-term funds in the sector.

By the Undersecretariat of Treasury, in compliance with the Private Pension Savings and Investment System Law, Regulation on Working Principles and Procedures of the Individual Pension Advisory Board, Regulation on the Establishment and Operation Principles of the Pension Companies, Regulation on the Individual Pension System and Regulation on the Private Pension Agents.

The Law on Individual Pension Savings and Investment System Law and Law on Amendments to Certain Laws and Decree Laws in order to reorganize the incentives for the private pension system was published in the Official Gazette dated 29 June 2012 and numbered 28338 and the government contribution application enacted by this Law was issued by the Undersecretariat of Treasury The Regulation on Government Contribution in the Individual Pension System published in the Official Gazette dated 29.12.2012 numbered 28512.

Characteristics of the Individual Pension System

The basic features of the individual pension system can be listed as follows:

The system operates on the basis of volunteerism and is open to the participation of all sections.

Savings are assessed by pension funds established under the supervision of the Undersecretariat of Treasury in pension funds established under the legislation of the Capital Markets Board.

With the obligation to set up at least 3 pension mutual funds with different risk and return mixes, which are subject to pension companies, individuals are allowed to make investment choices that fit their risk and income expectations.

Investments can be evaluated in a variety of investment instruments such as public and private sector debt instruments, deposits, participation accounts, repo and reverse repo transactions, partnership shares, derivative transactions, warrants, gold and precious metals, lease certificates, mutual fund participation shares.

Participants can change the fund and / or pension companies they purchase their shares. Participants who have the right to change the fund distribution 6 times a year may invest in the shares of another fund by returning their fund shares at any time. In order to change the company, the participants must stay in their existing companies for at least 2 years. If the participant's contract has already been transferred from another company, this period will be reduced to 1 year.

The assets of the pension mutual fund are kept separately from the assets of the pension company in a custodial establishment deemed appropriate by the Capital Markets Board.

These features are in the frame;

The creation of an accumulation of 5-10% of the gross national income,

Expanding the scope of social security and contributing to the increase in wealth levels by providing additional income to participants during the retirement period,

The creation of additional resources to be able to use the real sector, realizing a steady growth by increasing production and employment in this way,

To contribute to the development and deepening of the markets by providing new resources to the money and capital markets and to improve the public and private sector borrowing opportunities in this way

It is among the objectives of the Individual Pension System.

Incentives and Tax Arrangements

- Government Contribution

The amount corresponding to 25% of the contributions paid to the private pension system is paid to the participant's state contribution account. Deposits in this account are assessed on funds with a lower fund-to-total expense ratio, specifically designated for government contribution payments. In the event that the participant withdraws from the system due to retirement or death or disability, the entire amount of government contribution account will be paid to himself / herself (or in case of death).

If the participant is willing to leave the system without being entitled to retirement, the rate of entitlement to government contribution will be determined as follows.

After 1/1/2013;

A) Participants remaining in the system for at least three years will receive government contributions and, if any, fifteen percent,

B) At least six years on the system