The Government Promotes the Capital Covered Pension Scheme

Occupational Retirement Provision

Since 2002 there is a legal claim on occupational retirement provision in the context of deferred compensation.

This means you can arrange with your employee that part of your gross income will be converted into a capital covered pension scheme without being taxed or contributed to social insurances.

In 2012 you can save tax and social insurance contributions on the total amount of EUR 2,688. Further than that you may convert up to EUR 1,800 tax-free if no flat tax calculation process agreement was decided on before 2005 (Art. 40b Income Tax Act).

Private Retirement Pension

Additionally a subsidised private retirement pension can be established. The government promotes it in context of the “Riester”- pension with contributions and tax benefits.