Which pension expenses can I deduct in the tax return?

Pension expenses are expenditures with which you provide for your future. Pension expenses are divided into health and nursing care insurance, retirement provision, and other insurance.

Retirement pension expenses mainly include contributions to the statutory pension insurance, a Riester pension, or a private Rürup pension (funded pension scheme). Contributions to occupational pension schemes are also included if they provide benefits comparable to statutory pension insurance. This mainly applies to employees and self-employed members of professions with chambers, such as doctors, dentists, veterinarians, pharmacists, tax consultants, lawyers, auditors, notaries, architects, engineers.

There is a separate maximum amount for payments into a Riester contract. Therefore, you can claim contributions to the specially subsidised Riester pension separately. For this, there is the "Anlage AV", in which the Riester contributions must be entered. This must then be submitted to the tax office together with the provider's certificate.

Contributions to statutory and private basic health insurance as well as statutory nursing care insurance (i.e. social nursing care insurance and private compulsory nursing care insurance) are deductible as special expenses in their actual amount and without limit.

Other pension expenses mainly include contributions to unemployment insurance, occupational disability, accident, and liability insurance, term life insurance, private health insurance (beyond basic cover), and private nursing care insurance. Capital life insurance and pension insurance with a capital option (considered at 88%) as well as pension insurance without a capital option concluded before 2005 are also included here.

Insurance that does not serve future provision is not deductible as pension expenses. This includes, for example, property insurance such as household, legal protection, or comprehensive car insurance.

Also not deductible as pension expenses are contributions to direct insurance, a pension fund, or a pension scheme if they are tax-advantaged. Insurance amounts and other pension expenses do not fall under the "special expenses allowance" because they are not unlimited deductible special expenses.

The maximum pension amount is usually already exhausted by health and nursing care insurance and retirement pension expenses. Therefore, other pension expenses (see above) often have no tax effect.

For this reason, it is advisable to claim occupational insurance not covered by the employer as income-related expenses. In practice, a deduction in Anlage N (section "Employees > Income-related expenses") is mainly possible for professional liability insurance and professional legal protection insurance.

As accident insurance usually covers both private and occupational risks, the contributions are partially deductible as income-related expenses and partially as special expenses. Claim 50% of the contributions as income-related expenses and 50% as special expenses ("other insurance"). However, if you have a hazardous occupation and the occupational risk share is greater than 50%, you should have this confirmed by the insurance company. Claim the certified share as income-related expenses and attach the certificate to your tax return.

(2023): Which pension expenses can I deduct in the tax return?

Up to what amount can I deduct insurance and pension expenses?

Pension expenses (contributions to the statutory pension insurance, professional pension schemes, and Rürup pension insurance) are deductible up to a certain maximum amount. However, in past years, the contributions only actually reduced tax by a certain percentage. This percentage changed annually, starting at 60% in 2005 and was set to rise to 100% by 2025.

However, the new rule is: From 2023 onwards – and not from 2025 – pension expenses are 100% deductible as special expenses (Section 10 (3) sentence 6 EStG, amended by the "Annual Tax Act 2022" of 16.12.2022).

In 2023, the deductible maximum amount for pension expenses is 26.528 Euro for single persons and 53.056 Euro for married couples. This amount applies in both West and East.

Other insurance expenses are deductible up to 1.900 Euro if the taxpayer receives tax-free contributions to their health insurance or allowances for medical expenses. If they do not receive these tax-free contributions, they can claim up to 2.800 Euro as other insurance expenses. However, the contributions only reduce tax if the maximum amount of 1.900 Euro or 2.800 Euro has not already been used up by contributions to basic health and nursing care insurance.

If you pay lower contributions to basic health and nursing care insurance, you have a little leeway to deduct contributions for unemployment insurance, liability insurance, and other insurances.

The tax office always considers contributions to private and statutory basic health insurance and statutory nursing care insurance at their actual amount, even if they exceed the maximum amount of 1.900 Euro or 2.800 Euro. Only if these amounts are not used up by health and nursing care insurance contributions can other insurance contributions be deducted within the remaining leeway.

(2023): Up to what amount can I deduct insurance and pension expenses?

Which pension contributions can I enter as pension expenses?

Pension expenses include contributions to the state pension insurance, the Rürup pension, the agricultural pension fund, and the occupational pension scheme. Employees can enter contributions to agricultural pension funds and contributions to a voluntary state pension insurance.

Since the employer's contribution to the state pension insurance is also included, the special expenses are much lower. Pension expenses can be claimed up to a certain maximum amount. Since 2015, the maximum amount has been linked to the maximum contribution in the miners' pension insurance, rounded up to a full euro amount.

In 2023, pension contributions are fully deductible up to 26.528 Euro for singles and 53.056 Euro for married couples. These contributions have a 100% tax-reducing effect, contrary to initial plans.

Other insurance expenses are deductible up to 1.900 Euro in total if the taxpayer receives tax-free subsidies for their health insurance or allowances for medical expenses. If they do not receive these tax-free subsidies, they can claim other insurance expenses up to 2.800 Euro.

(2023): Which pension contributions can I enter as pension expenses?

What can I claim as special expenses in my tax return?

Special expenses are personal living expenses that are exceptionally eligible for tax relief. The special expenses you can declare in your tax return are divided into two groups: pension expenses and other special expenses.

The other special expenses referred to on this input page are automatically taken into account by the tax office with the special expenses allowance. The special expenses allowance is set very low at 36 Euro for single persons and 72 Euro for married couples. It is therefore relatively easy to exceed. These include, in particular, church tax paid, donations, childcare costs, and maintenance payments to an ex-spouse.

Pension expenses include contributions to basic health insurance and compulsory long-term care insurance, as well as private pension schemes and contributions to certain private insurance policies, such as private liability, accident, and occupational disability insurance.

The special expenses allowance does not apply to pension expenses. These are not unlimited deductible special expenses but are only deductible up to a maximum amount.

The second part of the special expenses, pension expenses, is divided into pension contributions, contributions to basic health and long-term care insurance, and other insurance. Pension contributions mainly include contributions to the statutory pension insurance or a private Rürup pension (funded pension scheme).

Other insurance includes contributions to health and long-term care insurance (beyond basic cover), unemployment insurance, accident and liability insurance, term life insurance, occupational disability insurance, and capital life and pension insurance policies taken out before 2005.

Please enter the pension expenses in the “pension expenses” section of our tax return.

(2023): What can I claim as special expenses in my tax return?