Get Ready for Changes in Partial and Active Retirement: Key Points of the New Pension Reform

(Royal Decree-Law 11/2024, of December 23, for improving the compatibility of retirement pensions with employment)

On April 1, 2025, important changes will come into effect regarding the partial and active retirement pension system. These measures aim to promote compatibility between work and retirement, as well as to encourage the sustainability of the system.

At GM Integra HR, we explain how these new developments may influence your future.

MAIN CHANGES:

1. Incentives for Deferred Retirement

Are you considering delaying your retirement? Now it will be more attractive thanks to:

• Financial supplements from the second year of deferral.
  • If you choose an additional percentage, it will increase by 2% for each period longer than 6 months and less than a year.
  • If you prefer a lump sum, an additional 0.5% will be added for each period longer than 6 months and less than a year.
• Compatibility with active retirement, allowing you to receive these incentives while continuing to work.

2. Compatibility between Retirement Pension and Work

The reform makes it easier to maintain your professional activity while enjoying your pension:

• You can now combine your retirement pension with a part-time job without reducing your pension.
• Active retirement is expanded:
  • Allows you to work full-time or part-time, either as an employee or self-employed.
  • The percentage of pension you can combine varies depending on the years of deferral before retirement, starting at 45% and reaching 100% after 5 years.
  • Self-employed: You can combine 75% of your pension if you have at least one permanent employee for 18 months or hire a new one with no previous employment relationship.

Additionally, these percentages can be increased by an additional 5% for every 12 uninterrupted months in active retirement, up to a maximum of 100% of the pension, always respecting legal limits.

3. More Flexible Partial Retirement

The reform introduces improvements in partial retirement, both for those reaching the ordinary age and for those who decide to take early retirement:

• Extended reduction of working hours: You can reduce your working hours by up to 75% after reaching retirement age.
• Early partial retirement:

Available from the age of 62. The reduction in working hours will always be between 25% and 75%, except if you access partial retirement at age 62, in which case the reduction during the first year will be between 20% and 33%.

• • Accumulation of working hours will continue to be allowed.
  • The replacement contract must always be permanent and full-time, with an obligation to maintain it for at least 2 years after the end of partial retirement.

Manufacturing Industry:

• You can access partial retirement until December 31, 2029 with specific requirements, such as:
  • Having 75% permanent employees.

The contribution base for partially retired workers will be 80% of the base that would have applied if working full-time, regardless of the actual reduction in working hours. This percentage will apply from 2029. Until then, a transitional period is established.

4. Other Relevant Measures

In addition to changes in pensions, the reform introduces other new features:

1. Bonuses for sports clubs:
   • A 100% employer contribution bonus is established for non-profit clubs that hire coaches or trainers for minors under 18 years old.
2. IRPF and ISD exemptions:
   • Extraordinary aid received after the 2024 DANA will be exempt from taxation.
3. Pensions for 2025:
   • Maximum pensions: €3,267.60/month (14 payments).
   • Minimum pensions: +6%.
4. Extension of the current SMI:
   • Until the new SMI for 2025 is approved.
5. Updates to contribution bases:
   • Minimum bases increase according to the SMI plus one sixth.
   • Maximum bases and caps will rise by 2.8% plus an additional 1.2%.

6. Intergenerational Equity Mechanism: increases to 0.80%, with 0.67% paid by the company and 0.13% by the worker;
7. From 1-1-2025, the additional solidarity contribution will apply to remuneration exceeding the maximum contribution base.
8. Self-employed with multiple activities:
   • Right to a refund of 50% of the excess contributions if they exceed €16,672.66.

9. ERTEs and RED Mechanism:

• • Extension of the obligation to maintain employment from 6 months to 2 years after ERTEs due to ETOP causes or force majeure.

HOW DOES THIS AFFECT YOU?

At GM Integra HR, our team of experts is ready to help you understand how these changes impact your employment and financial decisions.

For more information, you can contact us at

93 872 69 44 or 91 278 31 94.

You can contact us:

By email: comunicación@gmintegrarrhh.com

Call us at: 93 872 69 44