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Tuesday, February 7, 2023
HomeLatest NewsWhy hasn't my pension been raised? Social Security explains it

Why hasn’t my pension been raised? Social Security explains it

Date: February 7, 2023 Time: 22:07:11

Why hasn’t my pension been raised? This is one of the questions that pensioners have asked miles in the last two days, coinciding with the advance payment of these economic benefits by some banking entities such as CaixaBank, Banco Santander, Unicaja or Bankinter. Well then, to answer this question, the first thing to know is what type of pension is received, that is, if it is contributory or non-contributory.

Precisely in this sense, the Government of Spain recognized a revaluation of pensions in the General State Budgets, which are reflected in Royal Decree 1058/2022, of December 27. 15% for non-contributory, that is, those managed by the Imserso together with the autonomous communities, while for contributory, those managed by Social Security, the increase is estimated for this year at 8.5%. Now, here is the crux of the matter. What personal income tax from the retirement pension? Well, in 2005 a tax reform came into force that changed the income tax brackets, which meant that it went from seven to seven, in addition to changing the withholding percentage for each group.

As a consequence, by increasing the amounts as of this same month of January, the income brackets that strengthened the tax burden of each taxpayer based on their income may also have varied. Likewise, they are also used to calculate the monthly withholdings of each worker or, in this case, if he is a pensioner. Sources consulted with the Social Security press office explain to this media outlet that “pensioners will have received the increase in the event that their bank has advanced the payment, but the percentage of personal income tax will be deducted from their pension. The rest will do so on February 1, the day on which the effective payment is made by the Public Administrations”.

How to calculate the income tax withholding of my pension?

Personal income tax is divided into income brackets that strengthen the tax burden of each taxpayer based on their income. They are also used to calculate the monthly withholdings of each worker or, in this case, pensioner. These withholdings must be included in the personal income tax return in order to settle the tax for each group.

When calculating the IRPF of a retirement pension, the personal and family situation must be taken into account, beyond the amount received. This is established in article 81 of the Personal Income Tax Regulation, which establishes three groups of family situations of vital importance when making the income statement.

Single, widowed, divorced or legally separated. Spouse with an annual income of less than 1,500 euros. Others.

Likewise, the Tax Agency offers a simulator in which you can calculate what percentage of personal income tax you have to pay if you are a pensioner. In any case, the personal income tax withholding tables for the retirement pension are the following:

Up to 12,000 euros: 1% Between 12,000 and 18,000 euros: 2.61% Between 18,000 and 24,000 euros: 8.69%

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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