Wegweiser Occupational disability · Pension & insurance Deutsch

💶 Taxes on the reduced earning capacity pension and private BU pension

Like the old-age pension, the statutory reduced earning capacity pension is taxed on a deferred basis, while benefits from private occupational disability insurance are treated differently depending on the contract design.

Taxation § 22 EStG Earnings portion (Ertragsanteil) Deferred taxation Taxable portion (Besteuerungsanteil)

In brief

Like the old-age pension under § 22 Nr. 1 Satz 3 Buchst. a EStG, the statutory reduced earning capacity pension is taxed on a "deferred" basis: a taxable portion (Besteuerungsanteil), graduated by the year the pension starts, is taxable, the rest remains permanently tax-free as an individual pension allowance (Rentenfreibetrag). The later the pension starts, the higher the taxable portion.

For private occupational disability pensions the exact contract design matters: if the BU cover is embedded as an add-on in a private pension insurance, the benefit is often taxed only at the lower earnings portion (Ertragsanteil); for a stand-alone BU insurance outside the basic provision, the tax treatment can differ. There is no flat percentage that is the same for all contracts.

Step by step

  1. Check the pension notice or tax certificateThe Deutsche Rentenversicherung and private insurers issue certificates every year for the tax return.
  2. Check the taxable portion or earnings portionBoth depend on the year the pension starts and the type of contract.
  3. Get tax advice for complex BU arrangementsIn particular for Rürup contracts with a BU add-on or self-employed work.
  4. Cross-check the pension allowance in the tax assessment noticeErrors in the allowance amount, which is fixed once, have an effect over the entire duration of the pension.

Deadlines

No statutory deadline
There is no separate deadline for the tax treatment itself – the general deadlines for the income tax return apply.
Watch out – common mistakes
  • The taxable portion of the statutory pension depends on the year the pension starts, not on the current calendar year – a cohort principle that is fixed for the entire period of receipt.
  • Whether a private BU benefit is treated in full, with the earnings portion or differently depends heavily on the contract design. This page deliberately gives no uniform percentage, as it depends on the individual case and should be clarified individually with the insurer or a tax adviser.
In depth · legal basis, figures and practice – for advisers and professionals

§ 22 EStG: deferred taxation of the statutory pension

The taxable portion rises by law in steps for new pension cohorts; the pension allowance once determined applies as a fixed euro amount for the entire duration of the pension.

Earnings-portion taxation for pension insurance with a BU add-on

Benefits from a supplementary BU insurance attached to a private pension insurance are often taxed only at the lower earnings portion (Ertragsanteil) laid down in § 22 EStG.

Stand-alone BU insurance

For a stand-alone BU insurance outside the basic provision, the tax classification depends on the specific contract design; this page deliberately makes no flat statement on this.

Who is responsible
  • Tax office (Finanzamt)
Further reading
Occupational disability in Riester and Rürup contractsReduced earning capacity pension: requirements, qualifying period and application

Quick questions

Worum geht es bei „Taxes on the reduced earning capacity pension and private BU pension“?
Like the old-age pension, the statutory reduced earning capacity pension is taxed on a deferred basis, while benefits from private occupational disability insurance are treated differently depending on the contract design.
Which deadlines and figures matter?
No statutory deadline: There is no separate deadline for the tax treatment itself – the general deadlines for the income tax return apply.
What should I do first?
  • Check the pension notice or tax certificate: The Deutsche Rentenversicherung and private insurers issue certificates every year for the tax return.
  • Check the taxable portion or earnings portion: Both depend on the year the pension starts and the type of contract.
  • Get tax advice for complex BU arrangements: In particular for Rürup contracts with a BU add-on or self-employed work.
What do I need to watch out for?
  • The taxable portion of the statutory pension depends on the year the pension starts, not on the current calendar year – a cohort principle that is fixed for the entire period of receipt.
  • Whether a private BU benefit is treated in full, with the earnings portion or differently depends heavily on the contract design. This page deliberately gives no uniform percentage, as it depends on the individual case and should be clarified individually with the insurer or a tax adviser.
Evidence
  • § 22 EStG (gesetze-im-internet.de)
As of

September 2026 · Sources and method

A question about your situation that this page does not answer? Write to us or use the contact form – we will tell you which office is responsible and what to bring. Free of charge, without individual legal advice.