What are the loan options for pensioners this year and in 2024

What are the loan options for pensioners this year and in 2024
What are the loan options for pensioners this year and in 2024
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Going into early retirement is less suitable for me than before the last changes. This pension amendment increases the reduction of the pension for hard work and limits the valorization until reaching the full retirement age. In addition, it is possible to go into early retirement no more than two years before reaching retirement age. I eat about 50% of my pension before these changes, so logically, during the summer leave, it has already increased.

At the end of 2023, the average pension in the Czech Republic amounted to 18,500 crowns. Men receive an average of 19,728 crowns, women 17,347 crowns, which is 2,381 crowns less. The average daily retirement pension is 20,254 crowns, according to data published by the Czech Social Security Administration.

Development of average working income in R
Period Prmr in K Mui in K women in K
09-2023 18,500 19,728 17,347
06-2023 18,398 19,603 17,284
03-2023 17,618 18,793 16,531
12-2022 16,245 17,866 14,760
09-2022 16,211 17,833 14,727
Source: SSZ, from 2023

The number of pedestrians walking in Esk Piton has increased sharply in recent months. While in 2022, 676,441 people received a pension, at the end of the year there were 716,310 of them, which is an increase of 39,869 pensioners. At the end of 2023, there were a total of 2,365,668 old-age pensioners.

When choosing a fixed pension, however, it is necessary to deal with limited loan options, otherwise a similar fixed pension could not be paid after the tax, points out Gabriela Ivanco, tax adviser at Mazars.

Employed? Only for agreements

Due to the possibility of receiving a retirement pension, it is not possible to have an income from which social security is payable until the retirement age is reached. 50-year-old pensioners who want to receive a pension cannot work even for short pay. In employment, there is only work on agreements with remuneration up to a limit.

In 2023, the social obligation is not to pay from the agreement for the work performed, if the gross monthly remuneration is 10,000 crowns and min. In the case of an employment agreement, social security is not payable if the gross salary is 3,999 crowns or less. Current pensioners can work on agreements with remuneration up to the limit for each employer at the same time, added Ivanco.

Since January, they have been writing the terms of the agreements

A consolidated package is being prepared, which should be valid from January 1, 2024, but after that there will be a limited extension of the activity of pensioners. In the case of employment agreements for work performed, the possibility of earning more than the newly established limit in the case of the employer will be limited.

Two new loan limits will be introduced, if they are exceeded, a number of employees will be on the pension system and will therefore have to suspend the payment of their pension. The average salary for the given year will make up for it.

The first limit will be set for agreements to perform work with one employer, namely at more than 25% of the average salary, i.e. a maximum of 10,081 crowns per month for the year 2023.

The second limit will then apply to the concurrence of several agreements with each employer, namely up to 40% of the average salary. This means that if a particular pensioner works on a number of contracts for work performed with various employers, you will not be able to earn more than 16,130 crowns per month.

What happens when working on a classic employment contract

By itself, the retirement pension does not prohibit retired pensioners from entering employment on a normal employment contract. Anyone who decides to sign a classic employment contract and start working must inform his employer that he is on a temporary pension. It is the employer’s duty to report this fact using the completed social security claim form and to pay the appropriate pension.

As a result, the adjusted retirement pension will be paid to the fund either when the full retirement age is reached, or after the death of this employee, according to the tax adviser.

Passive income does not matter

Pensioners can remain calm if they have so-called passive loans. So, for example, regular income from renting an apartment and a house, or passive income from investments.

Due to the fact that social security is not paid from capital income or from the rental of real estate, regardless of their value, passive income is an ideal financial source for pensioners. In addition, in the tax pension for the year 2023, a fee discount of up to 30,840 crowns will also be applied to pensioners.

Thanks to the discount on the fee, for example, for income from it in excess of 293,700 crowns and the applicable 30% income tax, pensioners do not pay anything in tax on the loan, noted Ivanco.

The article is in Czech

Tags: loan options pensioners year

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