(2022)
When will I receive the special expenses deduction?
In addition to the allowances, the tax incentives for the Riester pension provide a financial benefit for investors. You can deduct not only your own contribution but the entire savings amount, including the government allowances, up to the specified maximum limit as special expenses from your tax.
As part of the tax return, the tax office automatically checks whether the government allowances or the special expenses deduction offer a greater advantage for the insured person. If the tax benefit is higher than the allowances, the tax office refunds the difference. To claim contributions as special expenses in the tax return, you need the certificate from the Riester provider. You must also fill in the "Form AV".
Even if you have not yet received your provider's certificate, you should submit your income tax return. Generally, the tax office already has an electronic notification from the Riester provider, so the tax office can consider your Riester contributions.
Since 2008, a maximum of 2:100 Euro can be deducted as special expenses. The tax benefits are particularly worthwhile for high-earning savers.
You must claim the special expenses deduction in your income tax return for the year in which you paid the contributions into the Riester contract. Not only your own contributions but also the Riester allowances are eligible. The decisive factor is always your allowance entitlement, not the actual allowance paid. Even if you do not apply for an allowance, the allowance entitlement can be deducted as special expenses and is added in the income tax assessment. It is not possible to forgo the pension allowance and instead take the tax benefit for yourself. However, always remember to pay at least the basic amount, including for any indirectly eligible spouse.
Please also note the following: The provider of your pension contract transmits the pension contributions to be considered, including the contract data, identification number, and allowance or social security number, to the tax authorities via data transmission. As mentioned, you must submit the Form AV if you are applying for a special expenses deduction. By submitting the Form AV, the additional special expenses deduction is claimed for all (!) transmitted pension contributions.
If you do not wish to claim a special expenses deduction for all transmitted pension contracts, please do not submit the Form AV.
Multiple pension contracts
If you exceptionally have multiple pension contracts, it becomes quite complicated, and you should note the following:
- The pension allowance is only granted for two of these contracts.
- However, there is no such limit for the special expenses deduction.
- If you submit the Form AV, the special expenses deduction is granted for all transmitted pension contracts, more precisely, it is calculated and then capped.
- If you do not want to claim the additional special expenses deduction for all contracts, please make entries in lines 31 to 40.
The advantage of waiving the special expenses deduction is that the later pension from this contract is not taxed in full but only at the more favourable income share. In addition, the contributions can be deducted as other pension expenses within the maximum limits, provided there is still "leeway". For the slightly more favourable taxation later, however, no "Riester allowance" may have been granted for the affected contract.
The allowance recipient can declare to their provider that they do not intend for the tax authorities to consider the pension contributions paid to the provider for the respective contract when determining the deductible special expenses under § 10a of the Income Tax Act (§ 10 para. 4 sentence 1 Pension Implementation Regulation). If the provider has such a declaration, they will no longer transmit any data to the tax authorities from the following year.
