Recent changes in tax regulations significantly affect retirees and pensioners. The deadline for submitting the 2024 tax return is at the end of July. For new retirees, 83% of their pension is taxable, while older retirees are taxed on 82.5% of their pension. By 2058, pensions will be fully taxable. The tax-free allowance is set to rise, providing more financial leeway for pensioners. The basic allowance will increase to 11,784 euros in 2024. Additionally, retirees supporting needy relatives can claim a higher maintenance allowance.
There are also specific forms retirees must be aware of, such as the "Anlage R," which includes pensions from domestic sources, additional retirement benefits, and foreign pensions. Understanding these changes and forms is crucial for optimizing tax savings. Moreover, with the gradual increase in the retirement age to 67, early retirees face a monthly reduction of 0.3% for each month they claim benefits before reaching the standard retirement age. These evolving regulations highlight the importance of staying informed to ensure financial stability in retirement.
