What is the Active Pension?
The Active Pension (Aktivrente) is Germany's new tax incentive for working past the statutory retirement age. Since 1 January 2026, wages of up to 2,000 euros per month – that is 24,000 euros per year – remain fully income-tax-free if you work as an employee alongside your statutory pension. The legal basis is the Active Pension Act, which anchors the exemption in § 3 Nr. 21 of the Income Tax Act.
The idea behind it: those who are fit and enjoy their work should be financially rewarded for staying in the labour market longer. For many pensioners this means several hundred euros more net per month – without any extra working hours.
How large your personal benefit is depends on your wage, your pension and your tax rate. With our <a href="/en/active-pension-calculator">Active Pension Calculator</a> you can see within seconds how much tax you actually save and what remains net at the end.
Who benefits – and who does not
The tax exemption applies exclusively to dependent employees. Anyone who works as an employee and has reached the statutory retirement age can use the bonus. Self-employed persons, freelancers and business owners are explicitly excluded. So anyone who keeps working on their own account in retirement does not benefit from the Active Pension.
A second point is decisive: the bonus only applies from the statutory retirement age. Anyone who retires early and works on the side has no entitlement beforehand. The good news: once you cross the threshold, you can benefit from the tax exemption for as long as you like.
How the 2,000-euro tax bonus works
The mechanism is simple: the first 2,000 euros of your monthly gross wage are not counted for income tax. If you earn exactly 2,000 euros or less, your entire wage is income-tax-free. If you earn more, only the excess is taxed normally.
The interplay with your pension is important. The pension itself remains taxable and is taxed normally according to your taxable share. Without the Active Pension, your wage would be added on top of the pension and taxed at your personal marginal rate. Exactly this burden now disappears for the first 2,000 euros – which is why the benefit is especially large if you already receive a solid pension.
A worked example
Take a former sales assistant with a gross pension of 1,400 euros who continues to work part-time for 1,500 euros gross per month after the statutory retirement age. Without the Active Pension, her wage would be taxed together with her pension – depending on the situation, that can quickly be 200 to 300 euros of income tax per year attributable to the wage. With the Active Pension, the full 1,500 euros stay tax-free because they are below the 2,000-euro limit.
If she earns 2,500 euros instead, 2,000 euros stay free and only 500 euros are taxed. The exact saving depends on the marginal tax rate – simply try your own figures in the <a href="/en/active-pension-calculator">Active Pension Calculator</a>.
Retirement age: from when does the Active Pension apply?
The statutory retirement age is 67 for everyone born in 1964 or later. For older cohorts a graduated scale applies: those born in 1958 reach it at 66, and for the years 1959 to 1963 it rises in two-month steps – 1959 at 66 years and 2 months, 1960 at 66 and 4 months, and so on up to 1963 at 66 years and 10 months.
Only once you have crossed this threshold does the tax exemption apply. Our calculator automatically determines from your year and month of birth when you reach the statutory retirement age and shows whether you already benefit or from which month it applies.
Social contributions remain – the tax disappears
Tax-free does not mean contribution-free. The Active Pension concerns only income tax, not social insurance. Contributions to health and long-term care insurance are still due on your wage. The big plus: after the statutory retirement age, your employee contributions to pension and unemployment insurance no longer apply. So you no longer have to pay these two items.
The bottom line is that noticeably more of the gross wage remains than for a younger employee with the same salary – partly because of the dropped pension and unemployment contributions, and partly because of the new tax exemption.
The Active Pension and your pension
Your statutory pension is not reduced by continued work. It continues unchanged and is taxed as usual. Those who wish can even collect additional pension points through voluntary contributions and thereby increase their later pension – but this is optional and independent of the wage's tax exemption.
Common questions briefly answered
Do I have to apply? No, the exemption is taken into account in the wage tax deduction and in the income tax return. Does the bonus also apply with several employers? The 2,000-euro limit refers to the tax-free maximum overall. Does a mini-job count towards it? A mini-job is already taxed at a flat rate; the Active Pension is worthwhile above all for higher wages.
Conclusion
The Active Pension makes working in retirement significantly more attractive: up to 2,000 euros of wage per month stay tax-free, the pension continues unreduced, and tiresome pension and unemployment contributions disappear. Whether the step is worthwhile for you and how much extra net lands in your pocket is best calculated directly with our <a href="/en/active-pension-calculator">Active Pension Calculator</a>.