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Voluntary APE - Financial advance payment guaranteed by pension
The APE is a loan commensurate with and guaranteed by the old-age pension. It is paid by the bank in 12 monthly instalments and can be obtained by the beneficiary once they become eligible. It will be in effect, on an experimental basis, from 1st May 2017 until 31st December 2019 (Article 1, paragraph 166 et seq., 2017 Budget Law and Article 1, paragraph 162, of the 2018 Budget Law).
The voluntary APE - a financial advance payment guaranteed by pension - can be requested by civil servants and private sector employees, self-employed workers and members of Separate Pension Scheme (Gestione Separata). Freelance professionals registered in professional social security schemes are not eligible.
The loan is paid out by lenders and is insured against the risk of predecease by insurance companies selected from those that comply with the framework agreements stipulated between the Minister of Economy and Finance and the Minister of Labour and Social Policies as well as, respectively, the Italian Banking Association (ABI), the Italian Association of Insurance Companies (ANIA) and other primary insurance companies (technical documentation relating to the exchange of data between INPS, financing institutions and insurance companies is attached).
In the event of the death of the interested party before the complete repayment of the debt, the insurance company will pay any outstanding debt to the bank. The survivor's pension, if any, is paid without any deductions.
The loan is paid out for a minimum period of six months and until the recipient is entitled to an old-age pension. The loan is paid from the first day of the month following the one in which the claim for the APE was submitted.
The minimum amount of the APE amount that can be claimed is €150.
The maximum amount of the APE amount that can be claimed cannot exceed, respectively:
- 75% of the net monthly pension amount if the duration of the APE payment period is longer than 36 months;
- 80% of the net monthly pension amount if the duration of the APE period is longer than 24 months and equal to or less than 36 months;
- 85% of the net monthly pension amount if the duration of the APE period is between 12 and 24 months;
- 90% of the monthly pension amount if the duration of the APE period is less than 12 months.
Furthermore, the maximum monthly APE amount received cannot be such as to result in a monthly mortgage loan instalment which, when added to any instalments for loans with residual mortgage periods longer than the APE period, exceeds 30 per cent of the monthly sum of the pension payments, net of any instalments for revenue debt and any divorce allowance, child support allowance and allowances established at the time of separation of the spouses.
The amounts paid as loans do not constitute as income for the purpose of income taxation of natural persons. The interest rate and the insurance premium relating to the insurance against the risk of predecease, as stipulated in the relevant framework agreements, are applicable to the amount paid out as an APE.
To offset interest on the loan and insurance premiums for the cover against the risk of predecease, an annual tax credit is granted up to a maximum of 50% of the amount equal to one-twentieth of the interest and insurance premiums agreed in the relative contracts. This tax credit does not constitute as income for income tax purposes and is recognised by the INPS for the full monthly sum, starting from the first pension payment.
The loan received is repaid in 240 instalments over a period of 20 years by means of a deduction made by the INPS with each accrued pension payment. The repayment of the loan starts with the first future pension payment.
The on-line Voluntary APE Calculations service is accessible to all citizens and can be found on the Institute’s website. After the interested party has entered their details and information, the service calculates, as indication only:
- The monthly loan amount;
- The duration of the APE;
- The monthly repayment amount which will be deducted from the pension sum.
Once repayment is complete, the pension will be paid in full, without further deductions for the APE. However, it may be possible to partially or fully repay the loan in advance, in accordance with the criteria set out in the Prime Minister's Decree No. 150 of 4th September 2017.
To be entitled to this loan the following requirements must be met at the time of the claim:
- The applicant must be at least 63 years of age;
- The applicant must have accrued a contribution period of no less than 20 years;
- The applicant must have a future monthly pension payment, net of the mortgage instalment for the requested loan, equal to or greater than 1.4 times the minimum payment of the Compulsory General Insurance (AGO);
- Interested parties whose first contributions were credited on after 1st January 1996 must have a pension amount lower than 1.5 times the amount of social allowance referred to in article 3, paragraph 6, of law n. 335 of 1995;
- The applicant may not be entitled to a direct pension or to invalidity allowance;
The applicant is not required to stop working.
How can I claim?
In order to receive the APE, the interested party or the authorised intermediaries must submit the claim for certification of eligibility for the APE to the INPS by means of at least the second-level SPID (public digital identity system), or by using their INPS PIN.
The INPS will check that the legal requirements are met, certify the right to the APE and inform the applicant of the minimum and maximum loan amounts that can be received.
The on-line service known as Voluntary APE - certification claim for sending APE eligibility certification claims is available. It can be used to monitor the progress of your claim and view the outcome.
Once the certification of the right to the APE has been obtained, the interested party can send the APE access claim, still using at least the second-level SPID digital identity system, by means of the “Voluntary APE – claim for the financial advance payment guaranteed by pension” service. For operating instructions, please refer to the User manual for completing the APE claim (PDF 2.05 MB).
The claim for the APE, which includes the claim for an old-age pension, financial support, insurance and for access to the fund, which will be settled when the legal requirements are met, cannot be revoked, except in accordance with the right of withdrawal which can be exercised within the deadline provided for by the law on credit and banking and the Consumer Code. In the claim, the applicant must indicate both the lender from which the loan is being requested and the insurance company to which the request to cover the risk of predecease is directed.
The lending institution will send the lending agreement or the notice of rejection, if applicable, to the INPS. If the claim is rejected, the APE claim, which includes the claims for an old-age pension, financial support, insurance and for access to the fund will be null and ineffective.
In the event of a loan being granted, the 14-day period for exercising the right of withdrawal will begin from the moment the contract is made available to the applicant on-line.
The APE claim will be null and ineffective in case of withdrawal.