Cabinet approves active pension – but not for the self-employed

In the future, pensioners will be allowed to earn up to €2.000 per month tax-free if they continue to work voluntarily. The skilled trades sector is skeptical, especially because self-employed people are excluded from the regulation.

On 15 October, the Federal Cabinet approved the introduction of Active pension decided: People who already retired are to be up to 2.000 Euro a month earn extra tax-free can. The The Federal Government has submitted the corresponding draft law The law will then go through the parliamentary process. The start is scheduled for 1 January 2026 intended.

The new project aims to Tax credit introduced for income from employed Work up to 2.000 euros per month applies. Those entitled to this Employeewho have reached the statutory retirement age and voluntary want to continue working. 

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Federal Finance Minister Lars Klingbeil (SPD) stated: "We are providing further impetus for economic growth in Germany." The economy is particularly dependent on older and experienced workers and skilled workers, the Vice Chancellor said in a statement. The regulation creates additional financial incentives for this. 

The active pension is expected to save the state around 890 million euros per year The lower tax revenues will be borne by the federal and state governments with 378 million euros each, and the municipalities with 134 million euros. The government expects that about 168.000 people will make use of this opportunity. 

Crafts make suggestions for changes

Together with six other leading trade associations, the Central Association of German Crafts (ZDH) a message Stellungnahme to the Federal Ministry of Finance. Goal, To create incentives for longer working in retirement, in principle welcomed. At the same time, the craft organization has several points critical highlighted and Proposed changes submitted:

• Since the tax exemption only applies to income from employment subject to social security contributions, self-employed and freelancers. This can constitutional problems cause
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• The early retirement without deductions remains in place and is therefore in Contradiction The goal of an active pension is to consider whether it still makes sense.
  
  
• The rules for reducing the tax exemption and their application in the wage tax deduction are not sufficiently coordinated. This is especially true for Partial months It remains to be clarified how they are to be applied.
  
  
• One should also check whether people who have already before entry into force of the Active Pension Act and have not yet reached the statutory retirement age ("existing early retirees"), included to make better use of existing workforce.
  
  
• The planned Start on 1 January 2026 is too ambitious. later start, A date of around 1 January 2027 would be more realistic and would facilitate implementation in the wage tax procedure.
  
  
•  Overall, efforts should be made to improve the incentives for To reduce early retirement and to examine the active pension for its constitutional conformity.

The advisors at the Chambers of Crafts will be happy to help you with any legal questions!

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