Growth Opportunities Act: New impetus for the Rürup pension

Growth Opportunities Act: New impetus for the Rürup pension

The state-funded Rürup pension offers an opportunity for private retirement provision where savings contributions can be tax-deductible. While contributions are deductible during the savings phase, later pension payments are subject to tax. A current development through the Growth Opportunities Act brings relief for Rürup pensioners.

Since 2023, the savings contributions for the Rürup pension have been completely tax deductible. This applies for the entire year up to a maximum of 27,566 euros per person, including contributions from statutory pension insurance and professional pension funds. The pension payments are subject to subsequent taxation, with a regulation stipulating that the tax share would be increased by one percentage point annually up to 100 percent by 2040.

With the introduction of the Growth Opportunities Act, this taxation methodology was equalized. In 2024, the tax share for new pensioners will only be 83 percent of the pension and will increase annually by 0.5 percent for each new pension cohort. This level of control will not reach its maximum until 2058. This means that full downstream taxation of pensions will now begin later than previously planned. Rürup savers can also benefit from the “tax deferral effect”, as the tax savings during the savings phase are usually higher than the burden of the subsequent taxation of pension payments.