Temporary relaxation of the RVU tax
- What is an RVU?
An RVU is an Early Retirement Scheme that serves to bridge the period from dismissal up to the state pension date of an (ex) employee.
- What is an RVU tax?
With the idea that employees have to work longer, the tax authorities did not allow such an RVU until recently. If the tax authorities ruled that there is an RVU, the benefit was taxed with a final tax of 52%.
- What does the relaxation of the RVU levy entail?
The employer may pay the employee up to a maximum amount equal to the net AOW benefit for a maximum of 3 years to bridge the period up to the AOW date. This compensation is no longer taxed with a final levy of 52%, but with the regular levy according to the green tax table for special remuneration. This scheme is temporary and applies under the conditions stated until December 31, 2025.
- What is the starting date of the relaxation?
The intended effective date of the bill was January 1, 2021. However, the Senate only adopted the bill on January 12, 2021. As a result, there was no RVU threshold exemption on January 1, 2021. The bill does have retroactive effect to 1 January 2021.
- What are the conditions for the RVU threshold exemption?
- the benefit must be paid within 3 years before the employee's state pension age;
- the amount of the threshold exemption is calculated per month and is equal to the net AOW benefit. The AOW amounts are adjusted annually.
- Is my employer obliged to make a pension plan for me?
No. According to the law, your employer is not obliged to make a pension scheme for you and your colleagues, unless collective agreements have been made about this. Your employer is obliged to offer you a pension scheme if this is included in your collective labor agreement (CLA), or if your employer falls within a sector with a collective industry-wide pension fund. In the case of a collective labor agreement, please note that it has been declared binding by the Minister of Social Affairs and Employment.
- Can I save for a higher pension myself?
Yes. You can save yourself in various ways for a higher pension, or to supplement your pension. And in addition to saving on a bank account, it is also possible to save in a tax-friendly manner via an annuity insurance or a bank savings product. Building up (extra) pension is very sensible in a number of situations.
- Where can I find information about my accrued pension?
All information about your accrued pension can be found in a pension overview https://www.mijnpensioenoverzicht.nl/. Here you can check how much AOW and pension you have accrued, and what your attainable pension is. You can also consult your current Uniform Pension Overview (UPO).
- What is a UPO?
A UPO stands for Uniform Pension Overview and gives you an update about your pension every year. You will of course only receive this overview if you participate in a pension scheme. On the overview you can check what amount you can expect when you retire or if you become incapacitated for work, for example. Have you accrued pension with multiple employers? Then you will also receive multiple UPS.
- Where can I check whether I have accrued pension in the past?
You can first log in with your DigiD on https://www.mijnpensioenoverzicht.nl/. Here you will find an overview of everything about your pension. However, this information may not have been updated yet, or it may be incomplete. Therefore there is an alternative. You can contact the Pension Register Service Desk if you do not know whether you have accrued pension with employers in the past.
- What is value transfer?
Value transfer of your pension is the 'transfer' of your pension accrual − and the associated pension rights − from your former employer and former pension administrator to a new employer and pension administrator. If you continue to work in the same industry, the pension provider, the pension fund, may remain the same. Value transfer is then not an issue.
- Is value transfer sensible?
Whether value transfer is wise depends on a number of factors. It is important to make a comparison between the old and the new pension scheme. If your new plan is a final pay plan, value transfer may be sensible. Especially if you expect to make a career with your new employer. If your new employer has a defined contribution pension scheme, transfer may be unwise. Transfer can cost you or your next of kin a lot of money.
- What is the coverage ratio of a pension fund?
The funding ratio of a pension fund indicates the extent to which the pension fund is considered able to meet its payment obligations now and in the future. A pension fund is funded through a funded system. This means that employees pay pension contributions during their employment. These contributions are then invested by the pension fund, so that all pensions can be paid with these proceeds.