Budget 2022 | Tax burden for working pensioners to be reduced

Tax burden for pensioners who still work will be reduced at 20% per year over the next five years

Income tax for working pensioners will be levied only on work income, not pensions, finance minister Clyde Caruana has announced.

He said the measure will encourage people to continue working when they reach retirement age.

Pensioners today are collectively paying €27 million in taxes.

The measure will reduce the tax burden for pensioners at a rate of 20% per year, over a five-year span.

Caruana said around 8,500 pensioners, who are receiving supplementary income apart from their pension, will see a substantial decrease in the tax they pay, while a further 8,200 pensioners will not be taxed.

The measure will cost government €27 million.