Iraq: New Law Changes Retirement Age, Adds Registration Fees for Foreign Employees and Increases Pension Contributions
December 27, 2023
A new pension and social security law has been implemented. The new law changes retirement ages as follows: for men, the retirement age will vary between 50 to 63 years and for women, the retirement age will vary between 50 to 58 years, depending on years of service. Previously, the retirement age for men was either 60 years after 20 years of service, or any age if they have reached 30 years of service. For women, the retirement age was 55 years after 20 years of service or any age if they have at last 25 years of service. Additionally, the new law requires the employer to pay a registration fee of IQD two million (approximately USD 9,160) per foreign national to the Pension and Social Security Department through the Social Security system. The fee is a one-time payment per foreign national following their entry into Iraq. Further, for foreign nationals already in Iraq as of December 1, 2023, employers must pay a fee of IQD 750,000. Previously, there were no registration fees. Moreover, employers must pay an increased social security contribution rate to an employee’s pension at 20 percent of the employee’s gross salary (base salary plus any allowances), up from 12 percent of an employee’s base salary. While eight percent of this fee is covered by the Iraqi state for Iraqi nationals, employers must pay the full amount for foreign nationals.
This alert is for informational purposes only. If you have any questions, please contact the global immigration professional with whom you work at Fragomen or send an email to [email protected].
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