nevenrente

Nevenrente is a Dutch term used to describe pension income that is received in addition to a person’s primary pension entitlement. It refers to income from other pension arrangements or agreements that mature during retirement and is not part of the main pension from the primary scheme. The term is commonly used to describe multiple streams of pension income that a retiree may accumulate through different sources, such as additional pension arrangements from former employers or private pension policies.

Common sources of nevenrente include a second-pillar pension from another employer, an extra private pension arrangement, or an annuity purchased separately. In practice, nevenrente is treated as separate income within the broader pension landscape, but it contributes to the total retirement income a person receives.

Taxation and reporting of nevenrente follow the general rules for pension income in the Netherlands. Pension income is typically taxable as part of annual income, with the exact treatment depending on the type of pension and the specific arrangement. Pension providers often handle withholding where applicable, and individuals report all pension income on their annual tax return.

Impact on benefits and planning: The total pension income, including nevenrente, can affect other means-tested benefits and allowances, such as housing or healthcare allowances. When planning retirement, individuals are advised to consider nevenrente alongside their main pension to get a complete view of expected income and tax implications. Financial advisors and pension funds can help estimate how nevenrente will interact with other retirement income.

See also: AOW, second-pillar pensions, private pensions, pension administration.