According to the figures, a total of around €423 billion ($487 billion) was paid out. Around 72% of the benefits – totalling €304 billion – were classified as taxable income in 2025. The reason for this is the taxation rules introduced by Germany’s Retirement Income Act of 2005, which regulated the transition from upfront to deferred taxation. In 2022, around 42% of pensioners paid income tax“For many pensioners, the taxable portion of their pensions, after relevant deductions, falls below the annual basic allowance. According to the data, around 80% of pensioners liable for tax also had other sources of income, such as employment or rental income.