Fiscal annual margin
Fiscal annual margin is an important concept in Dutch tax law, especially for people who want to optimize pension accrual. The fiscal annual margin represents the amount that an individual is allowed to deposit into his or her pension fund each year, enjoying tax benefits. This space is intended to ensure adequate financial security after retirement.
Importance of fiscal annual margin for pension accrual
The amount of annual tax allowance is calculated based on a person's income and pension accrual in the previous year. The government has set maximum percentages at which one may contribute to the pension fund. Depositing money into the pension pot leads to tax deductions, which means that taxable income is reduced and thus less tax is due. Utilizing the annual tax allowance can have significant long-term benefits for financial stability after retirement, but it is essential to understand the rules and restrictions so that one can take full advantage of this tax benefit.
