The Tax Rebate (Pensioners) Rules (SL 123.174) have, by virtue of Legal Notice 52 of 2026, ceased to apply in respect of income earned after 31 December 2025.
Following this change, the Pensions (Tax Exemption) Rules have been updated through Legal Notice 53 of 2026, effective 1 January 2026.
Under the revised rules:
- Pension income derived in 2026 and subsequent years is 100% exempt from tax, up to a maximum of €37,104.
- A new targeted tax rebate has also been introduced for certain eligible individuals.
Where applicable, the rebate is calculated as follows:
(Chargeable income – €15,000) × 15%
This rebate is subject to the following limitations:
- The rebate is capped at €540
- It cannot create a tax refund
- It cannot result in a negative tax amount
- It cannot be carried forward to future years
If you would like to understand how these changes may impact your personal tax position, feel free to get in touch for tailored guidance.
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