The difference between annual allowance ('jaarruimte') and catch-up allowance ('reserveringsruimte')

Annual allowance and catch-up allowance may sound the same, but there is an important difference between them. Both give you fiscal scope to build up a pension with tax benefits. One is for this year and the other is for missed years. We clearly explain the difference between annual allowance and catch-up allowance, so that you make optimal use of your fiscal options. Ideal for entrepreneurs and employees who want control over their pension accrual.

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The difference between annual allowance and catch-up allowance simply explained

Annual allowance ('Jaarruimte') is your fiscal scope for this year. It is the maximum amount you are allowed to deposit for a pension with a tax advantage in 2025. You may use 30% of your pension basis (income minus State Pension ('AOW') franchise), with a maximum of €35,798.

Catch-up allowance ('Reserveringsruimte') is unused annual allowance from the past. Have you not used your annual allowance (in full) in previous years? Then you are allowed to catch up on this. You can go back up to 10 years, with a maximum of €42,108 in 2025.

The difference is therefore timing: annual allowance is about now, catch-up allowance is about then. Together, they determine how much you can deposit for your pension this year with a tax advantage.

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Calculate your annual allowance directly

Calculate your catch-up allowance

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Why are annual allowance and catch-up allowance important?

The difference between annual allowance and catch-up allowance determines your total fiscal scope. This is crucial for entrepreneurs with fluctuating incomes. In lean years, you only use your annual allowance; in good years, you also utilise your catch-up allowance.

For self-employed professionals (ZZP'ers) without a pension scheme, the combination is extra valuable. With a maximum annual allowance of €35,798 plus up to €42,108 in catch-up allowance, you can take a significant tax advantage.

For employees who want to contribute extra for their pension, it works the same way. Although your annual allowance is lower due to your pension accrual through work (should your employer have a pension scheme), unused scope remains available for 10 years as catch-up allowance.

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Smart use of the difference between annual allowance and catch-up allowance

The order in which you use your annual allowance and catch-up allowance matters. Always use your oldest catch-up allowance first. This is because it expires first (after 10 years). Then your more recent catch-up allowance, and finally your annual allowance for this year.

Practical tip for entrepreneurs: have you had a good year? Then utilise your full catch-up allowance. In leaner years, you only use your annual allowance. This way you optimise your tax advantage over the years.

Please note: do you deposit more than your annual allowance plus catch-up allowance? Then you will not receive a tax advantage on the excess amount. The money will, however, be held securely in your pension account.

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Important changes since 2023

The difference between annual allowance and catch-up allowance has remained the same, but the amounts have been significantly increased. The maximum annual allowance rose from €15,317 to €35,798. The maximum catch-up allowance went from €7,885 to €42,108.

You can now also look back up to 10 years instead of 7 years. And you can save on until 5 years after your State Pension age ('AOW-leeftijd'). These are important improvements for entrepreneurs and employees who want to continue working later.

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Make optimal use of your fiscal scope

Understanding the difference between annual allowance and catch-up allowance is essential for smart pension accrual. Annual allowance is your opportunity this year, catch-up allowance is your second chance for missed years. Together they form your total fiscal scope.

Would you like to know how much you can indicatively deposit within your annual allowance? With our handy calculator, you quickly get a good idea of your options. We make the complex calculation accessible, without you having to go through all the formulas and tables of the Tax Authority yourself. Many factors influence the exact amount, but our calculator gives you a reliable indication that you can work with.

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Calculate your annual allowance directly

Calculate your catch-up allowance