Pensions paid out by Social Security earlier this week have already been processed through the new IRS withholding tables, according to the Department of Labor.
Pensioners have received (in the case of Social Security) or are receiving (in the case of Caixa Geral de Aposentação) pensions this month with an increase adopted for 2023, amounting to 4.83% for pensions up to EUR 960.86 (the amount corresponding to two IFRS – Social Support Index), 4.49% for pensions from EUR 960.87 to EUR 2882.58 (two to six IFRS) and 3.89% for pensions of equal or greater value up to 2882.59 euro (from six to 12 IFRS).
In response to Lusa, an official source at the ministry, led by Ana Mendez Godinho, said that the payment of pensions to Social Security recipients has already been made subject to the new IRS tax withholding tables that will apply in the first half of 2023.
According to the new tables, the amounts from which wages and pensions are withheld by the IRS rose in January to 762 euroswhich represents an increase of 52 euros compared to the value of wages exempted in 2022 from withholding and 42 euros in relation to pensions.
As the Treasury Department pointed out at the time, the new tables were designed to ensure that “workers and pensioners who have been promoted actually have an increase in net income between the end of 2022 and January 2023.”
According to the Ministry of Labour, Solidarity and Social Security, the increase affected a total of 3.7 million pensions benefiting 2.7 million social security and CGA pensioners, with an annual cost of €1,265 million.