SteuerGo FAQs

(2022) Which allowances can pensioners use?

Pensioners who submit an income tax return can enter various allowances and incurred costs to reduce their taxable income.

Personal pension allowance
The pension allowance is determined in the second full year of receiving the pension. In the year the pension begins and in the second year, the pension is taxed at the so-called taxable rate. The remaining amount in the second year is the personal pension allowance, which remains tax-free for life. From the third year, the pension is fully taxable after deducting the personal pension allowance and the standard allowance for income-related expenses of 102 Euro.

Allowance for civil servants and company pensioners
Like the pension allowance, the allowance for civil servants and company pensioners will gradually decrease to zero percent by 2040. This allowance only applies to pensions and company pensions from direct commitments and support funds. In addition, pensioners receive a supplement to the allowance, which also decreases over time.

Here are the figures for pension start in 2022:

For retirement in 2022, the allowance is 14.4% of the pension, up to a maximum of 1.080 Euro, and the supplement is 324 Euro. Together with the standard allowance for income-related expenses of 102 Euro, the pension is tax-free up to 1.506 Euro for life.

Old-age relief amount
The old-age relief amount can be used by pensioners who receive additional income or wages alongside their pension. Additional income includes, for example, income from rental, capital assets, self-employment, private sales transactions, or Riester pensions. However, the tax office first deducts various amounts (saver's allowance, income-related expenses). The amount of the old-age relief depends on the pensioner's year of birth.

If you turned 64 in 2021 (born between 2.1.1957 and 1.1.1958), you will receive an old-age relief amount from 2022 for life of 14.4% of the income, up to a maximum of 684 Euro.

If you turn 64 in 2022 (born between 2.1.1958 and 1.1.1959), the old-age relief amount from 2023 is 13.6%, up to a maximum of 646 Euro.

Standard allowance for income-related expenses
For the pension, every taxpayer receives a standard allowance for income-related expenses of 102 Euro per year.

Special expenses
Contributions to statutory health and long-term care insurance can also be entered by pensioners as special expenses in the "Anlage Vorsorgeaufwand". Pensioners receive a health insurance subsidy from their pension insurance provider, which must be deducted from the contributions. Donations can be deducted as special expenses for tax purposes. The collected donation receipts thus reduce the taxable income. If you do not donate or have no other special expenses, the tax office deducts a flat rate of 36 Euro.

Exceptional expenses
Especially for older and sick people, exceptional expenses can arise that reduce taxable income. This could be accommodation in a nursing home, employing a household help, or hiring a tradesperson. But also medical costs, such as medication, glasses, or dental prostheses, can be claimed by pensioners.

Mini job
If a pensioner (over 65 years) takes on a mini job, this income is tax-free for them.

If, as a pensioner, you remain below the tax-free allowance of 10.347 Euro (2022) with the various allowances, flat rates, and deductible costs, you do not have to pay any tax on your income. For married couples, the amount is doubled.