Can adding savings to another EEA country pension plan help in German taxes

5 posts in this topic

Folks, 

 

My goal for 2020 is to legally reduce my tax burden. (DE salaried employee, DE as tax residency for 2020)

 

I have a pension account also in another EEA country. Was wondering if I would invest money in that pension account - can I deduct it from my German tax income? (I would not prefer the German private pension because the payments are not lump sum)

 

Appreciate your 2 dollars. (...given the value of dollar is gng down I did not feel right to write 2 cents! Ok bad joke. But its late.). But appreciate your advice.

Cheers!   

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Hi Kapil354, 

 

In short the answer is no, you can't get tax relief on pension plans outside of Germany. However, as an employee you can pay into a company pension account and take a lump sum on retirement. There is no need to annuitize the account. Investment option are a little confined but you get good tax relief. 

 

Paul

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16 minutes ago, Paul@CRCIE said:

Hi Kapil354, 

 

In short the answer is no, you can't get tax relief on pension plans outside of Germany. However, as an employee you can pay into a company pension account and take a lump sum on retirement. There is no need to annuitize the account. Investment option are a little confined but you get good tax relief. 

 

Paul

thanks Paul. Was wondering if you could invest 100% equity ETF in a bAV?

 

Cheerio! 

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3 minutes ago, kapil354 said:

thanks Paul. Was wondering if you could invest 100% equity ETF in a bAV?

 

Cheerio! 

 

Unfortunately not!

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Paul already answered this correctly (little wonder, he works at a great advisory company :-) )

There are only three kind of pension plans that bear any tax subsidies in Germany:

For employees only: bAV (company pension schemes). Read more about them here: https://www.crcie.com/financial-advice/foremployees/bav-company-pension-schemes/

For employees, public servants and people (even self-employed) married to employees or public servants: RIESTER pension plans: https://www.crcie.com/financial-advice/foremployees/riester/

For everyone (but predominantly high-earning employees and self-employed): RÜRUP pension plans https://www.crcie.com/financial-advice/self-employed/ruerup-basis/

 

Germany won't recognize any foreign pension plans for tax subsidies in general. At least in my long-time experience tat is so... ( I have read now and then that some contributions to British or US-American pension schemes ought to be tax-deductible, but that is probably only ever the case (if true at all) in special cases like secondment or such, me thinks).

Cheerio

 

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