What is fhst tax in bc

Partial retirement - taxation of earnings during the exemption phase (block model)

BFH judgment of March 21, 2013, VI R 5/12 (BFH press release No. 36 of July 3, 2013)


Income that is earned in the release phase as part of the partial retirement according to the so-called block model is generally not a pension. The plaintiff was therefore unable to claim either the pension allowance or the supplement to the pension allowance.



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Born in 1948 Plaintiff was employed as a civil servant in the year of dispute 2009. The responsible authority had already given him partial retirement in 2002 for the period from August 1st, 2004 to November 30th, 2013 Block model approved. The plaintiff then performed the service with the regular working hours until March 31, 2009; his release phase began on April 1st, 2009. From this point in time, the plaintiff was completely exempted from the service until his retirement at the end of November 30, 2013. The plaintiff declared the period from 1.4. until December 31, 2009 the part of the remuneration omitted as pension remuneration.

The Tax office and the tax court, on the other hand, qualified the income as current wages.




The BFH has confirmed the legal opinion of the tax office and tax court. The payments made in the exemption phase are no benefit equivalent to the retirement pension within the meaning of Section 19, Paragraph 2, Clause 2, No. 1, Letter a of the Income Tax Act. A similar payment is only given if it is comparable to a pension, widow's and orphan's benefit in terms of the reason for the grant. Like the retirement pension, the withdrawal must therefore serve a pension purpose, i.e. ultimately be an early retirement pension.

This was missing from the remuneration paid in the exemption phase. Because the remuneration made in the partial retirement is Remuneration for active work of the part-time employee, i.e. current salary. This is particularly evident in the other partial retirement model, namely when the civil servant throughout the entire partial retirement phase works half of the regular working hours with correspondingly reduced earnings.

The partial retirement model therefore primarily concerns the question of the periods in which the service is provided by the civil servant on the one hand and the salaries on the other hand, so it regulates Due date and Inflow time, but not the basic qualification of the mutually owed services. So if the services are provided in full working hours in advance and then the leave of absence phase is used, the payments made throughout the partial retirement therefore remain remuneration and do not become pension remuneration. The judgment also made it clear that an exemption from service with ongoing payments alone does not turn this into pension payments.



  • According to Section 19 (2) sentence 1 EStG, the Pension payments an amount determined according to a percentage and limited to a maximum amount (pension allowance) and a tax-free surcharge on the pension allowance.
  • In contrast, the remuneration of the professors emeritus is to be regarded as remuneration similar to the retirement pension Reaching theAge limit be done. The decisive factor here is the legal reason for the delivery (here: reaching the age limit). This also applies to the special case of the “58 rule”: Here the remuneration had the function of a early retirement.
  • For those in partial retirement Workers are the Advertising expenses not to be reduced because the expenses have no direct economic connection with the tax-free top-up amounts. However, the question of whether and under what conditions employees who are in the release phase can still claim income-related expenses at all has not been conclusively clarified. Here it will have to be examined in detail to what extent the expenditure involved in acquiring, securing and maintaining income (cf. Section 9 (1) sentence 1 EStG).
  • The tax-free top-up amounts are subject to the so-called progression proviso (Section 32b, Paragraph 1, Clause 1, No. 1, Letter g of the Income Tax Act). That means: A special (higher) tax rate is applied to the taxable taxable income. This often leads to additional tax payments in the income tax assessment of employees. However, the progression proviso does not apply to the (tax-free) additional contributions to the pension insurance, which are also to be paid by the employer in cases of partial retirement.
  • There are no special commercial law regulations for the accounting valuation and the disclosure of partial retirement agreements; however is hers accounting against the background of the mandatory offsetting of certain assets (e.g. assets from reinsurance or trust assets) with the accruals complex in individual cases. The accounting subtleties illustrated Zwirner in his article "Illustration of provisions for partial retirement" in BC 2011, 520 ff. (Issue 11), using case studies.


[Note d. Red.]



BC 8/2013