Private Unfallversicherung: Optimise pension and tax benefits for maximum advantages
22 Jun 2025
3
Minutes
Katrin Straub
CEO at nextsure
A private accident insurance provides financial security after an accident, but how are pensions from it taxed? Many insured individuals are uncertain about the tax treatment of benefits and contributions. This article explains everything important about the taxation of your accident pension and how you can optimally claim contributions.
The topic in brief and concise terms
Pensions from a private accident insurance are taxable based on the yield portion, which depends on the age at the start of the pension.
One-off capital payments from private accident insurance, such as disability benefits, are generally tax-free.
Contributions to private accident insurance can be claimed for tax purposes as precautionary expenses up to maximum amounts of 1,900 euros (employees) or 2,800 euros (self-employed individuals).
Understanding the Basics of Private Accident Insurance and Its Tax Relevance
A private accident pension provides financial security if you suffer permanent disability, such as fifty percent, following an accident.
It complements the statutory accident insurance, which typically only covers occupational and commuting accidents.
Thus, it closes a coverage gap for over seventy percent of accidents occurring during leisure time.
Benefits can be paid as a lump sum or as a lifetime pension, which have different tax implications.
Lump-sum payments from private accident insurance are often tax-free, while pension payments are subject to taxation.
You can claim insurance contributions for tax purposes under certain conditions.
For an informed decision between lump sum or pension, these differences are significant.
Detailed knowledge of these aspects is crucial to clarify how private accident insurance pensions and taxes are interrelated.
Correctly tax the income portion of your private accident pension
Annuities from a private accident insurance are not fully taxable, but only with the so-called yield component.
This component is determined in accordance with § 22 Number 1 Sentence 3 Letter a Double Letter bb of the Income Tax Act (EStG).
The amount of the yield component depends on your age at the start of annuity payments.
For example, if your accident annuity begins at age 50, the taxable yield component is thirty percent of your annual annuity.
However, if you receive an annuity for the first time at age 65, the yield component decreases to eighteen percent.
What matters is the age at the beginning of the annuity for determining the taxable component.
Example: An annuity of 1,000 euros monthly, starting at age 44, has a yield component of 35 percent, or 350 euros.
The exact regulations for annuity from private accident insurance are complex.
This regulation highlights how important the details are for your tax declaration, leading us to other types of benefits.
Evaluate capital benefits and special cases of accident insurance for tax purposes
In contrast to pension payments, lump-sum capital benefits, such as a disability payment from a private accident insurance, are in most cases tax-free.
These payments are considered compensation for physical impairments suffered and not income.
An exception is death benefits: These may be subject to inheritance tax, depending on the degree of relationship and allowances.
Special care should be taken with accident insurances that offer a guaranteed return of contributions.
For contracts from 2005 onwards, the income derived from them must be fully taxed. This is similar to endowment life insurances.
Pay attention to the contract details of policies with return of contributions to avoid up to thirty percent tax on income.
However, the deductibility of accident insurance does not only apply to benefits. Contributions can also reduce your tax burden.
Deduct private accident insurance contributions from taxes and save
You can claim the contributions to your private accident insurance as other precautionary expenses in your tax return.
For employees, civil servants and pensioners, an annual maximum amount of €1,900 applies.
Self-employed individuals who fully cover their health insurance contributions themselves can deduct up to €2,800.
These maximum amounts are often already exhausted by contributions to health and long-term care insurance.
As a result, additional precautionary expenses no longer have a tax-reducing effect.
You enter the contributions for a purely private accident insurance in supplement Vorsorgeaufwand of your tax return in line 50.
Check annually whether the maximum amount for precautionary expenses has already been reached in your case to avoid wasting potential.
More information on the topic Insurance and Tax can be found in our portal.
For certain groups of people, there are further deduction possibilities.
Expert knowledge: Utilize advertising expenses, operating costs, and design tips
The tax treatment of contributions to private accident insurance depends on whether it covers private or professional risks.
If the policy exclusively covers occupational accident risks, self-employed individuals can claim the entire contributions as business expenses.
Employees can then claim these contributions as work-related expenses.
For mixed contracts that cover both private and professional risks, an apportionment of the contributions is possible.
The tax office often accepts a flat-rate division of fifty per cent for professional and fifty per cent for private shares.
This can mean an annual tax saving of over 100 euros.
Our expert tip: Request a certificate from your insurer detailing the exact division of the insurance premium.
This way, you can accurately demonstrate the professional share and optimise your tax burden.
Self-employed individuals, in particular, often benefit from greater deductions for their accident insurance.
The regulations on disability and tax have similar complexities.
A structured approach is recommended to make optimal use of all aspects.
Mastering your path to the optimal tax treatment of your accident insurance
The correct tax treatment of your private accident insurance, especially the pension and contributions, can noticeably improve your financial situation.
Pensions are taxed at a favourable yield rate, the level of which depends on your age at the start of the pension.
Often, only eighteen to thirty percent of the pension is taxable, which reduces the burden.
Capital benefits are mostly tax-free, which represents a significant relief.
You can deduct contributions as precautionary expenses, with maximum limits of 1,900 euros or 2,800 euros applying.
Collect all relevant receipts and enter the values correctly in your tax return.
Careful documentation and knowledge of the regulations are key to annual savings of several hundred euros.
At nextsure, we are happy to support you in analysing your insurance situation and uncovering optimisation potential.
Request an individual risk analysis now: Have your insurance situation checked free of charge and receive concrete optimisation proposals.
More useful links
Bundesfinanzministerium offers official guidelines on the Income Tax Act here.
Bundesfinanzministerium provides further details on the income tax notices.
Deutsche Rentenversicherung offers a specialist publication on the intersection of pension and income.
GDV provides current statistics on business development in private accident insurance.
DGUV offers a relevant publication on topics of statutory accident insurance.
FAQ
Where do I enter the private accident insurance in the tax return?
You should enter contributions for a purely private accident insurance policy in the appendix for retirement expenses (usually line 50). Purely professional accident insurances or the professional shares of mixed policies should be recorded as deductible expenses in attachment N or as business expenses in attachment EÜR/GSE.
What is the difference between statutory and private accident pensions for tax purposes?
Pensions from statutory accident insurance are generally tax-free under § 3 Nr. 1a EStG. In contrast, private accident pensions are taxed on the interest portion, which usually results in a lower taxable amount than full taxation.
Does the taxation of earnings shares also apply to short pension terms?
For lifelong pensions from private accident insurance, profit share taxation according to § 22 of the EStG applies. For temporary pensions, § 55 of the Income Tax Implementation Regulation (EStDV) may apply, which can lead to different, often higher profit shares.
My maximum amount for retirement expenses has already been reached. Is it still worth declaring the accident insurance?
If the maximum amount for other precautionary expenses (1,900 euros or 2,800 euros) has already been exhausted by contributions to basic health and long-term care insurance, additional contributions to private accident insurance no longer have a tax impact. Providing this information is still correct, but it does not lead to any further tax savings in this area.
What are the tax implications of an accident insurance with premium refund?
In the case of accident insurance with premium refund concluded from 2005 onwards, the income is fully taxed upon payout if the payout is made as a lump-sum payment and does not meet the criteria for a tax-free payout (e.g., minimum term of twelve years, payout after the age of 60/62). The pension benefit is subject to taxation of the profit share.
Can I deduct contributions for my children's accident insurance?
Yes, if you have taken out private accident insurance for your children, for whom you are entitled to child benefits or child allowances, and you pay the contributions, you can claim these as your own other insurance expenses. The same maximum amounts apply.
