From 2025, the state pension age will rise in line with average life expectancy. This means that the state pension age will rise less quickly. Would you like to know when you will start to receive your state retirement pension (AOW pension)? You can find this on the Sociale Verzekeringsbank (Social Security) website: SVB.nl.

There will be 2 options for the new pension scheme. At this moment it is not clear yet which pension scheme is the most appropriate. Both plans are based on the amount of the contributions paid in rather than the amount of pension benefit paid out. Everyone will accrue a personal pension pot. In our case, this means that J&J will no longer be subject to a contribution deposit obligation for future pension accrual and that the unconditional indexation of the pension of active members will stop. As a result, the financial risk will be passing from the employer to the employee. At the moment it has not been decided yet how to deal with the pensions accrued until the moment of transition. If the accrued pensions are transferred to the new pension plan the new rules will apply, but if they remain behind the old rules will - under certain conditions - continue to be applicable. It is not clear yet how these pensions will be dealt with.

From 1 July 2025, the expectation is that, under certain conditions, you will be able to withdraw up to 10% of your pension pot as a lump sum. The conditions that will apply for this are:

•  The lump-sum can only be withdrawn on the pension commencement date.

•  You can withdraw up to a maximum of 10% of the value of the retirement pension as a lump-sum.

•  You cannot combine the choice for a lump-sum payment with the choice for a high/low or low/high benefit payment.

•  You cannot combine the choice for a lump-sum payment with the choice for an AOW bridging pension.

•  You will need your partner’s approval if your choice for a lump-sum payment results in a lower partner’s pension. 

•  The remaining amount of a lifelong retirement pension benefit after the withdrawal of a lump-sum must be higher than the maximum commutation limit for small pensions.

You will need your partner’s approval if your choice for a lump-sum payment results in a lower partner’s pension.
If you choose to receive a lump-sum payment, your income will be higher initially and lower afterwards, because you have taken an amount from your pension pot. This will also have consequences for your tax return and any supplements you are receiving because your taxable annual income will higher on a one-off basis.

• Tax rates before reaching state pension age are higher than after your state pension age. If you withdraw a lump sum before state pension age, this will be more expensive. Participants who reach state pension age in the first few months of the year pay less on the lump sum than those who reach state pension age later in the year. You will have the option, in the month in which your state pension starts or on the 1st of the month after your state pension starts, to defer the lump sum payment until 1 January after your state pension starts. That way, you will pay less tax and keep more pension.

• If you are entitled to allowances (such as rent or healthcare allowance), it may be the case that you can no longer receive the allowance, due to the lump sum payment. This is because your income will be higher in that year. This income is taken into account in the test to determine the amount of the allowances.

• If you have been divorced in the past and you and your ex-partner have opted for equalisation, then opting for a lump sum will also impact the payment to your ex-partner. This is because the ex-partner's payment will also be made at 10% in a lump sum. The amount that the ex-partner will then receive annually will also be reduced accordingly.

The House of Representatives has passed the bill to introduce the Lump-Sum Act. When the option of withdrawing a lump sum will become available is not yet certain. The law is awaiting approval by the Senate. Pension providers also need to have enough time to properly inform everyone about lump-sum withdrawals (6 to 9 months). It won't come into effect until 1 July 2025 at the earliest.