Tax Status of Premiums - Pensionskasse für die Deutsche Wirtschaft

Tax Status of Premiums - Pensionskasse für die Deutsche Wirtschaft

INFO
Information for Employers:
Tax Status of Premiums
Up to 4 % of the relevant premium assessment ceiling
for (western) statutory pension insurance can be paid into
PKDW free of tax and social security contributions (in accordance with § 3 No. 63 of the Income Tax Act [EStG]). In
2016, this amounts to EUR 2,976, or EUR 248 per month.
Premiums exceeding this amount will be subsidised differently depending on when the pension commitment
was granted.
> New commitments (granted from 01/01/2005 onwards)
Members whose pension commitment was granted
from 01/01/2005 may pay a further EUR 1,800 - over
and above EUR 2,976 - into PKDW tax free (in accordance with § 3 No. 63 EStG). The EUR 1,800 top-up is
subject to social security contributions.
> Old commitments (granted until 31/12/2004)
Under § 40 b EStG, if the pension commitment was
granted before 01/01/2005, the employee may pay in
an additional amount of EUR 1,752 into the company
pension scheme, i.e. taxed at 20 % (plus church tax
and solidarity supplement).
Premiums exceeding the limits specified in § 3 No. 63
EStG (EUR 1,800) and § 40 b EStG (EUR 1,752) may only
be paid in out of taxed income.
If premiums for the year exceed 8 % of the assessment
ceiling (in 2016: EUR 5,952), an application for a special
premium is required. If the employee has also included
disability cover in his insurance, an up to date health
check will be carried out.
Benefits (pension or lump sum) resulting from tax free premium payments are fully taxable and subject to mandatory health and nursing care insurance premiums.
Only the interest portion of benefits resulting from premium payments to the pension fund which are taxed individually or at a flat rate will be taxable when the pension is
paid (does not apply to additionally subsidised premiums).
You can find further information on this on our website
www.pkdw.de in the area »Für Rentner – Steuern und
Sozialabgaben«.
Please report premiums paid by using our electronic
premium
report
file
(Beitragsmeldedatei) (available on our website in the area »Für Unternehmen – Infos / Formulare«). You can also find
out here which type to report premiums under.
For questions on reporting premiums or account clarification, please feel free to contact:
Sarah Wollschläger
[email protected]
Tel: +49 (0)203 99219-22
or
Bettina Wiesel
[email protected]
Tel: +49 (0)203 99219-24
As of: 01/ 2016
Pensionskasse für die Deutsche Wirtschaft VVaG, Am Burgacker 37, 47051 Duisburg, Tel 0203 99219-0, Fax 0203 99219-38, www.pkdw.de