2023: New regulations in the pension area

09/01-2023

By now, it has almost become a tradition that a new year spells new regulations for the pension area. And 2023 is no different; This year, we welcome new regulations making it even more favourable for you to save up for your retirement. There is also talk of changing the basic deduction and top-bracket tax – and introducing a “top-top tax”. However, there has not been made any concrete plans for the implementation of this yet.

You can make bigger contributions to your aldersopsparing (old age savings scheme)

This year, it will become even more interesting to make contributions to an aldersopsparing. The period for making contributions up to the high ceiling of DKK 56,900 is expanded from 5 to 7 years before state retirement age. Moreover, the low contributions ceiling is raised from DKK 5,500 to DKK 8,800.

Contributions to an aldersopsparing are not tax deductible at the time of contribution. However, you will not be charged an income tax – or other taxes - when the pension is disbursed. Furthermore, disbursements from an aldersopsparing are not set-off against the state retirement pension.
Therefore, saving up with an aldersopsparing may be particularly advantageous if you expect a set-off in your state retirement pension supplement, when you retire. This is especially true if you are not paying top-bracket tax while saving up for your retirement.

If you are paying top-bracket tax, we will normally recommend you save up for your retirement with an annuity certain scheme or a life annuity scheme, giving you a big tax deduction. However, an aldersopsparing might be a great alternative for additional savings. It has a tax on returns of 15.3% which is less than for stocks and other capital income, where the tax on returns is 27-42%.

From 2023, it will become more favourable for pensioners to work

From 1 January 2023, the state will not set off the pension of state retirement pensioners, early retirement pensioners and senior pensioners, if their spouse or cohabiting partner is working.

In the summer of 2022, we also saw a political settlement to put a stop to offsetting a person’s own work income against the state retirement pension from 1 January 2023. However, the settlement has not yet become law. This is expected to happen during 2023 and expected to be retroactive, applying to all of 2023. We will get back to you once we know more.

Any questions?

If you have any questions, you are welcome to call us on 70 33 99 99 or write to us using the contact form on velliv.dk/en/contact.

Offsetting regulations in brief

For single pensioners, the pension supplement is reduced by 30.9 % of the annual income above DKK 91,300.
For pensioners married to or cohabiting with a non-pensioner, the pension supplement is reduced by 32% of the total of both incomes (except the salary income of the spouse/cohabiting partner) above DKK 182,900.
For pensioners married to or cohabiting with a pensioner, the pension supplement is reduced by 16% of the total of both incomes (except any salary income of the spouse/cohabiting partner) above DKK 182,900.
From 2023, income from employment and self-employment is not expected to be included in the offsetting basis for state retirement pension.