Overview

• Employees who have reached the statutory retirement age could earn up to €2,000 per month tax-free when they keep working, with the bonus applied via payroll and without a progression clause.
• Self-employed people and freelancers are excluded under the plan, and early retirees do not qualify.
• The cabinet is expected to take up the bill this week, a 1 January 2026 launch is targeted pending Bundestag and Bundesrat approval, and the scheme is slated for a three‑year trial and review.
• A government draft estimates yearly tax revenue losses of roughly €890 million across federal, state and municipal budgets.
• Official figures underline pressure on seniors, with about one in five 65+ living on €1,400 or less and basic old‑age support rising to around 739,000 recipients, while survivor’s pensions exempt €1,076.86 per month and many recipients face average cuts near €208.