The core of the Retirement Income Act is the harmonization of the taxation of retirement benefits through the general transition to a system of deferred taxation. In the final stage, it is envisaged that old-age pensions will be taxed in full - as is already the case with civil servants' pensions - and that contributions made to build up a pension will be exempt from income tax.
In addition to these constitutionally required legal amendments, further changes have been made in the following areas:
- New regulations for company pension schemes,
- Simplifications for funded private pensions (Riester pension) and
- Limitation of the tax privilege for endowment insurance policies
Note
You can also find information on the Retirement Income Act in the "Tax tips for senior citizens".