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Riester pension: applying for allowances

Deutsche Rentenversicherung · State-subsidised provision

About the providerStanding allowance application

The Riester pension is a private retirement provision that the state subsidises through allowances and a special-expenses deduction. The contract is with a private provider; however, the allowances are paid out and administered by the Zulagenstelle für Altersvermögen (ZfA, allowance office for retirement assets), which is based at the Deutsche Rentenversicherung.

The basic allowance under § 84 EStG is €175 a year; anyone who has not yet turned 25 at the start of the contribution year receives an additional one-off €200. The child allowance under § 85 EStG is €185 per child, and for children born on or after 1 January 2008 it is €300.

The full subsidy is only available with a sufficient own contribution. Under § 86 EStG, you must pay in 4% of your contribution-liable income from the previous year, less the allowances, but no more than the amount from § 10a EStG of €2,100. You must pay at least the minimum base amount of €60 a year. Anyone who pays less has the allowance reduced proportionately.

Last updated26 August 2026
Legal basis§ 84 EStG · § 85 · § 86 · § 10a
VerificationChecked against gesetze-im-internet.de
Written and reviewed byAndrés Sánchez Botta
Independent information site: We are not the Deutsche Rentenversicherung, not an authority and not a paid advisory service — we do not submit applications on your behalf. All information comes from official sources and is explained here in plain terms; the competent body is always authoritative. The Zulagenstelle für Altersvermögen is based at the Deutsche Rentenversicherung; the contract itself is with a private provider. All information is provided without guarantee. We are neither lawyers nor tax consultants: we document administrative procedures and check the information against the official source — this is information, not legal or tax advice.
Basic allowance€175Annually, § 84 EStG
Child allowance€300From birth year 2008; before that €185
Minimum own contribution4 %Base amount €60
Tax deductionUp to €2,100Special expenses, § 10a EStG
Required documents

What you need

Certified Riester contract

Only certified retirement provision contracts are subsidised. The certification number is stated in the contract. Without a certified contract there are neither allowances nor the special-expenses deduction – check this before signing.

Pension insurance number

The Zulagenstelle matches your details against the pension insurance scheme’s data using the pension insurance number. An incorrect or missing number is the most common reason why allowances are not paid out or are later reclaimed.

Information about the children

For the child allowance you need entitlement to Kindergeld (child benefit) and the children's dates of birth. The year of birth determines the amount: €300 for children born on or after 1 January 2008, €185 for those born before. The allowance generally goes to the parent who receives the Kindergeld.

Proof of eligibility for subsidy

Under § 10a EStG, those eligible for the subsidy include compulsorily insured members of the statutory pension insurance scheme, civil servants and certain further groups – in each case with unlimited income tax liability. Civil servants must additionally give written consent to the data transmission from their pay office.

Proof of previous year's income

The minimum own contribution is based on the contribution-liable income of the previous year. A rise in salary therefore only takes effect in the following year – anyone who overlooks this pays in too little and has the allowance reduced.

Step by step

How to proceed

  1. 1

    Check eligibility for subsidy

    Clarify whether you belong to the group eligible for subsidy under § 10a EStG. This includes in particular persons compulsorily insured under the statutory pension insurance scheme, civil servants, and certain other groups; unlimited income tax liability is always required. Spouses may, under certain circumstances, be indirectly eligible for subsidy if one partner is directly eligible.

  2. 2

    Take out a certified contract

    Only certified retirement provision contracts are subsidised. Compare costs and terms before signing: the state subsidy says nothing about the quality of the individual product, and high set-up and administration costs can eat up the benefit of the subsidy.

  3. 3

    Calculate the minimum own contribution

    Calculate 4% of your contribution-liable income from the previous year, deduct the allowances you are entitled to and cap the result at €2,100. The amount you arrive at is your minimum own contribution; if it is below €60, you must instead pay the minimum base amount of €60.

  4. 4

    Submit a standing allowance application

    Do not apply for the allowances afresh every year; instead, submit a standing allowance application to your provider. The provider then applies for the allowance automatically to the Zulagenstelle. This is the most effective safeguard against the most common mistake of all – simply forgetting to apply for the allowance.

  5. 5

    Report changes immediately

    Marriage, divorce, the birth of a child, a change in who receives Kindergeld, a job change, parental leave or a move into self-employment can change eligibility for the subsidy and the amount of the allowance. Report such changes to your provider promptly, otherwise you risk the recovery of overpayments going back several years.

  6. 6

    Claim it for tax purposes

    Enter the contributions in Annex AV of your income tax return. The Finanzamt (tax office) automatically carries out a more-favourable-treatment check: if the tax saving from the special-expenses deduction is higher than the allowances, you receive the difference in addition; otherwise you simply keep the allowances.

Fee information

Costs and payment

The allowances are state-funded, the costs privateCheck provider costs
Basic allowance€175/year
Bonus for under-25sOne-off €200
Child allowance, born from 2008€300/year
Child allowance, born before 2008€185/year
Base amount€60/year
Special expenses deductionUp to €2,100

The Zulagenstelle does not charge fees; the subsidy itself costs nothing. Costs arise solely with the private provider – set-up, administration, and fund costs. These costs are the decisive and most commonly underestimated point: with an expensive contract, the cost share can largely eat up the benefit of the subsidy, while the same state grant fully reaches you with a low-cost contract. The state subsidy is an argument for the retirement provision product as a type, but not for a particular contract. Check the effective costs before signing, and have the effect over the entire term shown to you.

Good to know

Important notes

The allowance must be applied for. It does not flow automatically. A standing allowance application with the provider settles this once and for all – without it, the allowance must be applied for afresh every year, and that is exactly what regularly gets forgotten.

Paying in too little means proportionately less allowance. If the minimum own contribution is not reached, the Zulagenstelle reduces the allowance in the ratio of the actual payment to the required payment. The subsidy is therefore not withdrawn entirely, but shrinks noticeably.

The own contribution is based on the previous year. The contribution-liable income of the preceding calendar year is decisive. After a pay rise, the required own contribution therefore only increases in the following year – anyone who overlooks this pays in too little.

2008 is the decisive cut-off for children. For children born before 1 January 2008, the child allowance is €185; for those born on or after that date, it is €300. With several children of different ages, both amounts apply side by side.

The young-starter bonus applies only once. Anyone who has not yet turned 25 at the start of the contribution year receives a one-off increase of €200 in the basic allowance. This makes taking out a contract early worthwhile.

The more-favourable-treatment check runs automatically. The Finanzamt itself compares whether the special-expenses deduction up to €2,100 is more favourable than the allowances. You only need to enter the contributions in Annex AV – you do not need to calculate anything.

Changes can trigger the recovery of overpayments. If eligibility for the subsidy changes – for example through a move into self-employment – or the Kindergeld recipient changes without this being reported, the Zulagenstelle reclaims allowances paid without entitlement, often retroactively for several years.

The payout is subject to tax. Riester pensions are fully taxed on a deferred basis in the payout phase. This is intentional, since the contributions were subsidised, but is often left out of return comparisons.

Avoid these mistakes

Common mistakes

Not applying for the allowance. No application, no allowance. A standing allowance application with the provider prevents this permanently and costs nothing – it is the single most important step with a Riester contract.

Calculating the minimum own contribution incorrectly. The 4% relates to the contribution-liable income of the previous year, and the allowances are deducted. Anyone who forgets the allowances or uses the current year's income pays in too little and has the amount reduced proportionately.

Overlooking the base amount. Even with low or no income, at least €60 a year must be paid in. Anyone who pays nothing at all receives no allowance – not even the basic allowance.

Not reporting changes. Birth, marriage, divorce, a change in who receives Kindergeld or a move into self-employment affect eligibility for the subsidy and the amount of the allowance. Failure to report leads to the recovery of overpayments going back several years.

Only looking at the subsidy. High set-up and administration costs can largely eat up the state grant. The subsidy is an argument for the type of provision, not for a particular contract.

Leaving out the deferred taxation. The later payout is fully subject to tax. Anyone who calculates the return without this point arrives at a systematically too favourable result.

Frequently asked questions

Questions and answers

How much are the Riester allowances in 2026?

Under § 84 EStG, the basic allowance is €175 a year. Anyone who has not yet turned 25 at the start of the contribution year receives a one-off increase of €200 in the basic allowance. The child allowance under § 85 EStG is €185 per child; for children born after 31 December 2007, it is €300.

How much must I pay in myself?

Under § 86 EStG the minimum own contribution is 4% of your contribution-liable income from the preceding calendar year, reduced by the allowances you are entitled to and capped at the maximum amount of €2,100 from § 10a EStG. If the result is below €60, the minimum base amount of €60 a year must be paid. If you pay less, the allowance is reduced proportionately.

Do I have to apply for the allowance every year?

Not if you submit a standing allowance application to your provider – the provider then applies for the allowance automatically to the Zulagenstelle für Altersvermögen. Without a standing allowance application, the allowance must be applied for afresh every year, and that is exactly what is often forgotten. The standing allowance application is therefore the single most important step with a Riester contract.

How large is the tax advantage?

Under § 10a EStG, retirement provision contributions plus the allowances due can be deducted as special expenses up to €2,100 a year. The Finanzamt automatically carries out a more-favourable-treatment check: if the tax saving is higher than the allowances, the difference is refunded to you in addition; otherwise you simply keep the allowances. You only need to enter the contributions in Annex AV.

Who is eligible for the subsidy?

Under § 10a EStG, those eligible are in particular persons compulsorily insured under the statutory pension insurance scheme, civil servants and judges with a statutory civil-service pension, certain self-employed persons and persons exempted from compulsory insurance with comparable prospective entitlements, as well as farmers covered by the farmers’ old-age security scheme. Unlimited income tax liability is always required; civil servants must additionally consent to the transfer of data by their pay office.

Which parent receives the child allowance?

As a rule, the parent who receives Kindergeld for the child. For married parents, the allowance can, under certain conditions, be assigned to the other parent on application. If the Kindergeld recipient changes, report this to your provider promptly – otherwise you risk the recovery of overpayments.

What happens if I pay in too little?

The allowance is not withdrawn entirely, but is reduced: the Zulagenstelle scales it down in the ratio of the contributions actually paid to the required minimum own contribution. So anyone who pays in only half receives only about half the allowance. Check your own contribution after every change in pay, therefore – what counts is the previous year’s income.

Is Riester worth it at all?

That depends less on the subsidy than on the specific contract. The allowances and the special-expenses deduction are the same for everyone; the set-up, administration, and fund costs, however, differ considerably and can largely eat up the benefit with an expensive contract. The subsidy is particularly favourable for families with several children born after 2007, because €300 per child then adds up. Also note that the later payout is fully subject to tax.

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