Latest updates on active, deferred and partial retirement

Active retirement: combining pension and work is now easier

Active retirement, which allows working while receiving part of the pension, now removes the requirement of having a full contribution career. This opens access to those with interrupted work histories, such as many women.

Additionally, the percentage of pension compatible with work will increase as follows:

• 1 year of delay: 45%

• 2 years: 55%

• 3 years: 65%

• 4 years: 80%

• 5 years or more: 100%

Every 12 months of uninterrupted professional activity will increase the pension by 5 percentage points, up to a maximum of 100%.

As a novelty, active retirement can now be combined with deferred retirement incentives.

Deferred retirement: more rewards for postponing retirement

Postponing retirement voluntarily continues to reward workers with a 4% annual pension increase.
Starting from the second year of delay, an additional 2% is granted for every six extra months worked.

The incentive can be received as:

• A pension increase,

• A lump sum payment,

• Or a combination of both.

Partial retirement: earlier access made more flexible

Partial retirement allows reducing working hours while simultaneously receiving a proportional part of the pension. Key changes include:

• It can be anticipated by up to three years before the legal retirement age.

• Working hours reduction will range between 20% and 75%, depending on time worked.

The replacement worker must have a permanent full-time contract.

These reforms in active, deferred, and partial retirement aim to offer new pathways to adapt retirement plans to individual needs, promote more sustainable retirements, and bring the effective retirement age closer to the legal retirement age. At Valero Tax Legal, we help you study all available options to plan your retirement safely, personally, and in line with the current regulations. Contact us for expert advice!