Flexible early retirement: how it works

Early retirement with Quota 103 for 2024: requirements, maximum limit, recalculation of allowance contributions.

There flexible early retirementor Quota 103, is a pension treatment introduced temporarily by the 2023 budget [1]. This provision was then extended, albeit with important changes, to 2024 through the latest budget law [2].

To access this form of early retirement, the following conditions must be met by 31 December 2024:

• have reached the age of 62;
• have at least 41 years of paid contributions behind you.

The personal data and contribution requirements have not changed compared to the forecasts for 2023. However, for those who fulfill the conditions set out during 2024, and not by 31 December 2023, important

disincentives to retirementsuch as the fully contributory recalculation of the allowance, normally penalizing, longer waiting windows and, until reaching the age for the old-age pension, a maximum amount equal to 4 times the minimum payment.

Specific conditions for Quota 103

To be admitted to Quota 103In detail, the requirements to be perfected are the following:

have accomplished 62 years old no later than 31 December 2024;

having reached, on the same date, 41 years of contributions, of which 35 years must be effective, net of periods of compensated unemployment, illness and injury not covered by the company. This specific requirement is applicable only to those who are registered with the Mandatory General Insurance and the INPS replacement funds

[3].

It is also possible to accrue 41 years of contributions through the heap of insurance periods, including contributions paid to the funds managed by INPS. However, contributions from the sector funds to which freelancers are registered are not considered [4]. However, contributions paid for work carried out abroad, in member states of the European Union or in countries with which Italy has stipulated social security agreements can be included.

To verify the contribution requirement, the rules of the social security management that provides the pension are considered pension. In the event that the accumulation involves managements that require a minimum of 35 years of effective contributions, net of illness and unemployment, it is necessary to evaluate the total contribution seniority, accrued considering all the managements involved [5].

Members of the former Enpals management (entertainment and sports workers) and Inps Employee Pension Fund (Fpld) can benefit, in addition to the cumulation, also from the so-called “totalisation in the Inps-Enpals agreement”

[6].

The requirements for access to Quota 103 are not related to the adjustment to life expectancy.

Access to pension

To access Quota 103, the pension calculation takes place according to the fully contributory method (Legislative Decree 180/97), for those who meet the requirements during 2024, including the case of accumulation of contributions.

Those who have already met the requirements for flexible early retirement by 31 December 2023, however, do not undergo the contribution recalculation, but can still request it (for example, if more advantageous, or to request a facilitated degree redemption), with the option to the system Of contribution calculation [8].

With the contributory option, consideration of voluntary contributions is excluded and a 50% increase is applied to contributions paid before the age of 18; furthermore, in this case it is not necessary to comply with the requirement of 35 years of contributions net of periods of unemployment, illness and accident. It is also possible to use the calculation

of contributions to the Separate Management [9]to obtain Quota 103.

The categories of personnel belonging to Defence, Security and Public Rescue are not eligible for the Quota 103 flexible early retirement.

Waiting windows

Similarly to what was established for the “Quota 100” and “Quota 102” pensions, the “Quota 103” provides for the application of “movable windows” which postpone the start of payment of the pension compared to the moment the requirements are achieved:

• Of 7 months for private sector workers;
• Of 9 months for public employees. Public employees must submit their retirement application to their institution with 9 months’ notice. For school staff, a single exit window applies [10].

The waiting windows for those who have completed the requirements during 2023 are equal to 3 and 6 months respectively.

There starting date of the pension, if paid under INPS General Mandatory Insurance, is set at the first day of the month following the closing of the applicable time window. If, however, the pension is managed outside of this form of insurance, the start of payment is scheduled for the first day following the end of the corresponding window.

Freezing of requirements

People who have reached the requirements for Quota 103 by 31 December 2023 have the possibility to request the pension under the conditions previously established even after that date, as confirmed by the budget law for 2024.

To benefit from this provision, it is sufficient to meet the requirements by 31 December 2023, regardless of the actual start date of pension payment. In practice, those who meet the requirements for flexible early retirement by the end of 2023 retain the right to treatment under the original conditions, without contribution recalculationwith shorter windows and a higher maximum amount.

There pension application it can be sent at any time after the requirements have been met, subject to exceeding the expected window period, even after the end of the experimental year, therefore also in 2024 and beyond.

This principle is also valid for those who meet the requirements for the flexible early pension in 2024, provided that the requirements are met by 31 December of the year, applying the conditions established by the new financial law.

Pension calculation

The Quota 103 early pension, for those who meet the requirements in 2024, is calculated with a fully contributory system, also for the treatment quotas relating to periods prior to 1996.

This calculation system, normally penalizing, is based, we remember, on contributions paid and on age at retirement, not on latest salaries or income, like the salary calculation system.

Furthermore, until the ordinary retirement age is reached, a maximum ceiling is applied to the pension, equal to 4 times the minimum treatment in force in the maximum: this means that the maximum monthly amount, until the completion of the 67 years old (current age requirement for the ordinary old-age pension), cannot exceed, for 2024, 2,394.44 euros.

The maximum limit it is higher, for those who have fulfilled the requirements for the flexible early pension in 2023, equal to 5 times the minimum payment, therefore 2,993.05 euros for 2024.

Incompatibility with work

The Quota 103 pension cannot be cumulated until the age requirement for the pension is met

old age pensionwith any work income; it can be cumulated with income from occasional self-employment [11] up to 5,000 euros per year.

If you carry out a work activity and receive the related income, while the flexible early pension is paid, yes suspends pension treatment for the entire year of income production.

In practice, even a small compensation deriving from a “job” is enough to lose the Quota 103 for the entire year. Only the periods before the starting date of the treatment and after reaching retirement age are excluded.

The interested party must communicate the incumulability to INPS using the AP139 or AP140 form (the latter is needed if the declaration is made at the same time as the pension application).

Application for flexible early retirement

For those who meet the requirements for flexible early retirement in 2024, INPS has adapted the management system of pension applications to the relevant provisions introduced by the 2024 budget law.

Access requests can be submitted directly from the Institute’s website, via the “Pension Application, Reconstitution, Accruals, Certifications, Social APE and Early Benefit” service. Alternatively, you can go to the Patronati or call the Integrated Contact Center.