Active pension 2026: Up to 2,000 euros tax-free for hard-working pensioners!

Active pension 2026: Up to 2,000 euros tax-free for hard-working pensioners!

On August 29, 2025, the coalition committee of the black-red federal government agreed on a comprehensive reform in the areas of citizens' benefits and the statutory pension. A central element of this reform is the introduction of the so-called active pension, which is due to come into force on January 1, 2026. The active pension is intended to serve as an incentive for people who voluntarily want to work longer in old age and thus counteract the increasing shortage of skilled workers, as echo24 reports.

With this new regulation, pensioners who have reached the standard retirement age can earn up to 2,000 euros a month tax-free. This includes a wide variety of forms of employment, be it a mini-job, part-time work or paid work. Nevertheless, there are some hurdles: People who have retired early are excluded from this tax relief, which is viewed critically by many experts. The critics also include economic institutes who doubt that many pensioners will actually be motivated to continue working by this measure. In 2024, over 550,000 people applied for early retirement, further fueling concerns about the pension system.

Objective of the active pension

The introduction of active pensions not only aims to strengthen the financial independence of older people, but also addresses the demographic challenges in Germany. Demographic change is bringing with it an increasing number of people over 65, which is putting increasing strain on the pension system. In order to counteract this development, the previous additional income limits and tax hurdles for retirees will be lifted. The federal government is planning to implement active pensions as part of a comprehensive pension package that is expected to be passed in the Bundestag by Christmas 2025.

Some of the main advantages of active pensions are obvious: many retirees can benefit from financial relief and at the same time help companies secure skilled workers. At the same time, personal responsibility in age management is strengthened. However, there are outstanding issues that urgently need to be clarified, including uncertainty about the timing of the law's adoption and the impact on early retirees.

The facts about active pensions

• Begünstigte: Rentner ab der regulären Altersgrenze, die freiwillig weiterarbeiten.
• Steuerfreier Hinzuverdienst: Bis zu 2.000 Euro monatlich.
• Regelung für vorgezogene Altersrenten: Nein, nicht anwendbar.
• Anspruch auf Weiterbeschäftigung: Kein Anspruch; Entscheidung liegt beim Arbeitgeber.

Another critical point is the upcoming financial situation: tax losses of up to 1.2 billion euros are expected for self-employed pensioners, as income falls due to the tax exemption. In the long term, this could lead to lawsuits if the exclusion of people who have retired early is not treated differently.

In another aspect, it was pointed out that around a quarter of pensioners in Germany receive less than 1,300 euros in statutory pension per month, which puts them below the at-risk-of-poverty threshold. The increasing pressure on the pension system cannot be ignored and urgently requires new approaches to pension provision. While Germany is struggling with an average gross pension of around 1,769 euros per month, similar models in Austria could serve as a model.

It remains to be seen how the legislative initiative will develop and what specific impact the active pension will have on the lives of the older generation. The first step, the development of the draft law, is due in September 2025. The political agreement appears to be future-oriented, but implementation will be crucial.

For detailed information about the upcoming changes in retirement planning, see the articles here pension notice24 and buerger-geld.org referred. Also deutschlandfunk.de provides interesting approaches to pension reform and its challenges.