February 4, 2023


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Pensions will be higher from July 2022. How much will recipients earn from the 17% to 12% income reduction?  Will this make up for the 10%?  Economic inflation?

There will be higher pensions from July 1. How much will the beneficiaries benefit from the reduction in income tax up to 12 percent? Will this make up for the 10%? economic inflation [3.04.2022]

Inflation, already at 10 percent in March, means that the pension index this year (7 percent) will not be able to compensate retirees and other people receiving benefits indexed in the same way from ZUS, the increase in the cost of living. The faster the costs of food, medicine, and housing increase.

Certainly part of this difference between inflation and the March index will be offset by the thirteenth pension – which is currently being paid, and the fourteenth pension, announced by the government in end of summer or early September.

Retirement budgets—like all people who pay taxes on the scale of the tax schedule—should be improved slightly by another tax reform, i.e. lowering the lowest tax rate from 17 percent to 12 percent.
Let’s check the amounts that will be.

Persons receiving a pension totaling up to 2500 PLN. They will not benefit from this change (as long as they do not have other additional taxable income with personal income tax) because their entire income from this pension is in the amount of tax exemption – PLN 30,000.

Such people, ZUS deducts only 9 percent of their total pension. Contributions to compulsory health insurance.
In the case of a person who has a pension of PLN 2,500 per month, the deduction is PLN 225, so the pensioner receives PLN 2,275 on hand.

The situation is different for people with higher pensions. In their case, ZUS deducts from the total pension both the health insurance contribution and the tax advance.

To be clear, we must add that the reform (12% income tax) will take effect on July 1, and from July the lower rate will be applied by ZUS when collecting advances to the annual tax. However, the change will take effect from January 1, 2022, which means that payments made in excess of the January-June period will be returned by the Tax Office after the annual income tax settlement is approved.

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