Potsdam (ots) –
The Wohn-Riester contracts are subsidized by the State in two different ways. The maximum allocations must be exhausted with the payments made. Additionally, tax savings are often possible. Your four walls are financed with a basic allowance of 175 euros and a subsidy of up to 300 euros for each child. Owning your own home as part of private old-age provision is still at the top of many people’s wish lists.
In addition to allowances, many savers can also count on an annual tax refund. Eligible expenses for old-age benefits of up to 2,100 euros (including allowances) are recorded as special expenses in Annex AV of the Income Tax return. However, the actual payback is always less due to offsetting assignments. As part of the least cost test, the tax office checks to see if the tax savings from the special expense deduction is greater than the allowance entitlement. If the tax concession is higher, there is an additional tax benefit.
A family with a child born after 2008 and a joint gross income of €75,000 receives the maximum allowance of €650 and a joint tax relief of approximately €391. A minimum personal contribution of 2,350 euros must be made as a contribution to the pension. The State thus assumes 1,042 euros of the old-age pension.
For a single person with a gross income of €45,000, there is a tax break of around €519 on top of the basic allowance. You only have to save 1,625 euros as a personal contribution. For the maximum deduction of special expenses of 633 euros, 1,925 euros would have to be paid. That would be the favorable test result.
Tax benefits vary widely based on filing status and income. “With the Riester subsidy, families benefit above all from the allowances, single people often have a greater tax advantage,” says Michael Wegner, Chairman of the Board of Directors of LBS Ostdeutsche Landesbausparkasse AG.
Telephone: 0331 969 21 54
Original content from: LBS Ostdeutsche Landesbausparkasse AG, broadcast by news aktuell
Source: press portal