Overview

• Florian Köbler, head of the Deutsche Steuer-Gewerkschaft (DSTG), proposes introducing a Quellensteuer on pensions next year to automatically deduct taxes from monthly payments for about 4.4 million retirees.
• The plan originated with a citizen-friendly income tax commission under former finance minister Christian Lindner and echoes CDU/CSU/SPD commitments to simplify taxes for pensioners.
• The Bundesfinanzministerium has said it is examining the feasibility of extending wage-tax withholding to pension payouts but has yet to publish any legislative draft.
• Deutsche Rentenversicherung has clarified that there is currently no law, draft or concrete proposal for pension withholding and cited missing data on tax classes and personal allowances as obstacles.
• Bundesverband der Rentenberater experts warn a flat withholding rate could lead to unfair deductions and place legal and financial burdens on low-income pensioners.