Pensioners are happy about the pension supplement: three million will benefit from July

Pensioners are happy about the pension supplement: three million will benefit from July

On April 25th, the German Bundestag passed the new pension law called the EM Stock Improvement Payment Act. This law is scheduled to come into force from July 2024 and grant three million pensioners a supplement to their regular pension. Those who received a disability pension between 2001 and 2018 should benefit from this supplement. Those affected do not need to submit an application to the German pension insurance, as the supplement is paid out automatically.

The surcharge will be paid out in two phases. From July 2024, a simplified supplement will be paid in the middle of the month, regardless of the regular pension payment. The second phase, which is scheduled to begin in December 2025, includes the full payment of the supplement according to the DRV calculation together with the current pension.

For pensions that started between January 2001 and June 2014, the surcharge under the new law is 7.5 percent. This means an increase of 75 euros for a pension of 1,000 euros to a total of 1,075 euros. For pensions that started between July 2014 and December 2018, the surcharge is 4.5 percent. A regular pension of 1,000 euros would therefore increase by 45 euros to a total of 1,045 euros.

The German pension insurance does not plan to retroactively offset the simplified surcharge against the amount paid out later. This is to ensure that all eligible retirees receive the full amount they are entitled to. The new legislation brings significant tax relief for three million pensioners in Germany.