(2022) How can I claim contributions to a Rürup pension in my tax return?

The tax incentives for the private basic pension (Rürup pension) apply to the contributions paid, although maximum amounts apply.

Single persons may deduct the contributions as special expenses - possibly together with contributions to the statutory pension insurance and to the occupational pension scheme - up to a certain maximum amount, whereby they then only have a tax-reducing effect with a certain deduction rate.

However, it is important to know: There is a transitional phase until 2023, after which the full benefit will be granted by deducting the full contributions.

Why is this the case? The Retirement Income Act of 2005 gradually increases the taxation of pensions. In return, the opportunities for policyholders to deduct their expenses for private pension provision from tax are increasing.

The deduction rate increases by two percentage points each year until it reaches 100 percent. Thus, the contributions will be increasingly promoted in the coming years until the tax exemption from 2023.

In 2022, pension contributions are deductible up to 25.639 Euro for single persons and 51.278 Euro for married couples. However, these contributions only have a tax-reducing effect of 94%, i.e. a maximum of 24.101 Euro or 48.202 Euro.

In return, the taxation of pension payments will increase until 2040: In the 2010 tax year, 60 percent of the pension from statutory and private insurance is taxed, the rest of the pension is still tax-free. By 2020, taxation will increase by two percentage points each year and then by one percentage point until 2040. Then both the statutory pension and the Rürup pension, as well as any private provision, will be fully taxed.

The Federal Fiscal Court considers the statutory transitional regulations in connection with pension taxation and the deduction of pension expenses to be constitutional (BFH rulings of 19.5.2021, X R 33/19 and X R 20/21). However, it has pointed out that this does not apply to future pensioners. There could be a risk of double taxation.

The Federal Government has announced that the full deductibility of pension contributions during the working phase, originally planned for 2025, will be brought forward to 2023.