2024-12-17 23:14:00
Wednesday 18 December 2024, 00:14
The final stretch of each year is time to pull out the calculator and make a series of financial decisions that can reduce your payment to the Treasury in the following year. This is what happens with pension plans, which enjoy some tax advantages both in paying out the capital and in redeeming it upon retirement.
Especially in the first case: the amounts that are paid into that piggy bank year after year reduce the tax base of personal income tax. However, at the time of the bailout, this capital is calculated for tax purposes as earned income – just like your salary or unemployment benefit – which will increase your tax base and, consequently, increase your tax burden.
However, depending on the type of bailout, there are ways to benefit from more favorable taxation. For example, there is a 40% reduction when the plan money is recovered as a lump sum (in a lump sum), provided that contributions are paid by 31 December 2006.
A legislative change prevents funds paid since 2007 from benefiting from this reduction, which means paying taxes on only 60% of the money saved. 40% are exempt.
For example, if you redeem 20,000 euros from the plan – again from contributions prior to 2007 – you will only have to pay Irpef for 12,000 euros. The remaining 8,000 are exempt from taxation.
Therefore, contributions prior to January 1 of that year may enjoy this tax benefit, “as long as the plan is collected as a lump sum in the year in which the event giving rise to the collection occurs (for example, retirement ), or in one of the following two years”, warns the Organization of Consumers and Users (OCU).
Therefore, it is interesting to redeem plan contributions in the form of capital before the end of 2024, when these three circumstances occur:
-If contributions to the plan were paid before 2007.
-If they have not yet been uploaded.
-If retirement – the reason for the redemption – occurred in 2022, since from 2015 the tax benefit can only be applied to redemptions made in the year of retirement or in the following two years.
The same thing happens, they add in the OCU, if you are a beneficiary of a plan due to the death of the participant, when the death occurred in 2022. «In order not to lose the right to the reduction for the amount paid before 2007, the plan will have to be recovered in the form of capital by 2024 at the latest,” the organization warns.
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