A pension foundation can be formed by any company – as a way of safeguarding pension promises outside of the company balance sheet.
Private business owners or partners in a partnership may not secure pension promises on their own behalf, but only for employees.
The pension foundation
- is an independent legal entity with its own board of directors - the board of directors determines, among other things, how the assets shall be managed
- must maintain accounts of its transactions and prepare annual reports
- pays tax on returns from pension funds in the same manner as insurance companies
- is subject to supervision by Länsstyrelsen (the County Administrative Board) and Finansinspektionen if the Foundation covers more than 100 beneficiaries.
- undertakes pension (promises) by entering into pension commitments with the employees
- makes a provision to the foundation (payment)
- disburses pensions to retirees
- collects compensation for disbursed pensions from the foundation.