Pension: How it stays tax-free
When you say goodbye to your well-deserved retirement, you can put all previous hassles with colleagues and superiors aside. It is not that easy with the tax office, which is developing more and more into a lifelong companion. Those who receive little and only pension do not have to worry about any tax payments. But even if the authorities require you to submit a tax return, pension payments can remain tax-free.
All citizens registered in Germany receive a tax identification number. This remains unchanged for a lifetime. Even small children are given a number. Later can Tax office Check retirees' retirement incomes and collect taxes.
Income below the basic tax-free allowance - pension always tax-free
- Pensioners who assume that they have nothing to do with tax returns may have to be taught otherwise. Because the tax office uses the personal tax identification number to check all pensioners who have not submitted a tax return to see whether this is not necessary.
- Above all, retirees have to plow the system R with their tax return. Your are tax-free pension and other income, if the total annual amount does not exceed the basic tax allowance of EUR 8004 for single persons (doubling for married persons) plus various flat-rate deductions.
- As a retired person, your pension is usually tax-free if you are not one of the recipients of high pensions or if you have additional income such as rent, Investment income and achieve company pensions.
Pensioners and their tax burdens
- It is best for all those pensioners whose retirement is before 2005. Single people do not pay any income tax here if the statutory pension does not exceed 1,575 euros per month. They then do not receive any further income. Every year around 18,900 euros are tax-free. For married couples, the amounts double.
- If you retire from 2005 onwards, the taxation will be different. Until 2020, the taxable portion will increase annually by 2 percent, then one percent. The taxed portion will then be 50 percent, in 2040 100 percent.
- A pensioner who retires in 2006 has to pay 52 percent tax. If you receive a pension in 2012, only 36 percent of these are tax-free, 64 percent must be taxed.
The financial administration is increasingly evaluating the pension data of all those pensioners ...
If the total of 64 percent is below the basic tax allowance of 2012 (8,004 euros), then you do not have to expect letters from the tax office or pay taxes.
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