Accumulation of fees and its distribution at the end of the year.
March 11, 2010 | 18,00 EUR | answered by Dipl.BW/SB Ulrich Stiller
Dear Sir or Madam,
I receive a small early retirement pension and have a side job. I am only allowed to earn 400.00 euros per month. However, the pension provider allows me to exceed this amount for two months per year.
Now my question is: I would like to accumulate "earned money" during the year in order to maximize my earnings within a year, and then have it paid out to me in two months at the end of the year. This way, I would be following the pension provider's guidelines.
However, my employer would like to know if this is permissible from a tax and legal perspective: is it allowed to accumulate earned fees during the year and distribute them in two months at the end of the year? If there are limitations, what are these limitations?
If possible, please also provide the relevant source or legal basis for this.
Thank you for your response.
Dear inquirer,
Thank you for your inquiry, which I would like to answer based on your information and in the context of your commitment in an initial consultation as follows:
As long as the additional income does not exceed 400 EUR, a full pension will be paid. If the additional income exceeds this limit, a partial pension will be paid instead of the full pension. This will be paid as a 3/4 partial pension, 1/2 partial pension, or 1/3 partial pension depending on the amount of additional income. The pension will be withdrawn if the additional income limit for the 1/3 partial pension is exceeded, with the additional income limit being allowed to be exceeded twice a year up to double the limit.
The regulation stating that the limit can only be exceeded through special payments was overturned by the BSG judgment of 31.1.2002 (B 13 RJ 33/01 R).
Therefore, the payout modalities you proposed are not permissible.
Best regards,
Ulrich Stiller
Tax consultant / Diplom Business Economist
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