Last Updated on Monday, 11 October, 2021 at 8:38 pm by Andre Camilleri
Income tax threshold will be increased to €14,318
Some 95,000 pensioners, including retirees, disabled and others who receive a non-contributory pension will be getting a €5 weekly increase in their allotment, or €260 per year.
This includes the €1.75 cost of living adjustment, which means that these pensioners will be receiving an additional €3.75 per week.
In all, this measure will cost the government €24 million.
Supplementary assistance to pensioners, elderly people and people in employment who do not have children below 16 years of age will also rise.
Married couples and other couples whose income in 2022 will not exceed €14,318 will be receiving between €3.47 and €6.50 per week extra, depending on their income.
Single persons, including widows and widowers, whose income in 2022 will not exceed €10,221 will be getting between €4.10 and €5 per week. A total of 29,000 will benefit from this measure, which will cost the government €5.6 million.
This will mean that many pensioners will be pocketing more than €500 more every year.
The income tax threshold will be increased to €14,318, so that any increase given as from next year will not be taxable.
The government will also gradually adjust widows’ pension to take it to the same level as that which was previously received by their partner. Subsequently, they will continue to pocket any other increases given by the government.
Some 12,000 pensioners, in 2022, will be getting a maximum €5 increase with a total expenditure of €3.3 million.
This means that pensioners who receive the widows’ pension and whose income does not exceed €10,221 will be receiving between €10 and €15 extra per week, or between €520 and €780 per year in their pension.
The government will once again increase by €200 the sum that will be ignored in the social security pension assessment, meaning that the exempted sum next year will reach €3,066.
People who received the services pension who will be 72 years of age or older next year will benefit from a higher social security pension. Some 3,250 pensioners will benefit from this, for a total expenditure of €2.7 million.
Gradually, the cost of living bonus will be paid in full to all pensioners who retired after 2008.
In 2022, 43,000 pensioners will be getting €2.50 per week increase (€130 per year), at a cost of €2.5 million.
An increase of €150 in the annual bonus will be given to people who have reached retirement age but do not qualify for a bonus as they have not paid enough social security contributions.
The bonus for people who paid less than five years of NI contributions will go up to €400 a year, and it will be €500 more for those who paid five years or more in NI contributions.
Some 12,500 people will benefit from this, for a total cost of €2 million. This is the largest increase given in this bonus since it was introduced in 2015.
In order to encourage pensioners to remain active and keep on working after reaching retirement age, for a period of 5 years, beginning next year, pension income for those who work will no longer be calculated as income for tax purposes. This means that around 8,500 pensioners who have alternative income will see a reduction in the tax they pay, while 8,200 pensioners who have another income aside from their pension will no longer be taxed. This measure will cost €27 million.
The government will also be addressing situations of persons, particularly women, who separate from their partner at a late age and would have spent years away from the working world to take care of the family and home. More details will be given later.
Some 800 persons, mostly women, now qualify for retirement pension after the NI contributions they paid before reaching the age of 19 started to be taken into consideration. There are another 1,200 persons who paid at least 10 years of NI contributions but are not entitled to a pension as they did not pay this contribution after 1979. These persons will also start to qualify for the lowest pensionable rate of around €50 per week.
People who reach the age of 59, and who have some NI contributions missing, can pay their dues up to a total of five years.
People who have more than one part-time job can start paying their NI contributions on a total of not more than 40 hours per week so as to become eligible for a better pension. Some 10,000 persons would be eligible.