Field help:
Did you pay money to someone as a permanent burden?
Select "yes" if you made payments in the form of a perpetual burden to a third party.
Perpetual burdens are regular monthly payments that can be adjusted at any time if the financial circumstances of the contracting parties change. The amount of the payment may, for example, depend on the profit of the transferred business.
The main application is asset transfer as part of anticipated inheritance. In this case, parents usually transfer assets (e.g. company shares) to their children during their lifetime. In return, the children commit to paying a monthly pension to the parents for life.
Important: The deductibility of perpetual burdens depends on the date of the contract. Since 01.01.2008, the distinction between perpetual burdens and pensions has been abolished. Pension payments are now always "perpetual burdens". This means that the calculation of the income share previously required for life annuities can be omitted. This means:
- The transferee may deduct the pension payments in full as special expenses (§ 10 para. 1a no. 2 EStG).
- The transferor must fully tax the pension payments as "other income" (§ 22 no. 1a EStG).
