Being self-employed as a pensioner: everything you need to know

Retirement no longer means you have to rest on your laurels. More and more pensioners are choosing to become self-employed: to continue sharing their knowledge, stay active or simply earn some extra income. But how to get started? And what do you need to take into account in terms of taxes, accounting, social security contributions and your pension?

Can you work as a self-employed person when you are retired?

Yes, being retired does not mean you can no longer work. On the contrary: our labor market needs knowledge and experience, and the law allows pensioners to engage in self-employed activities (under certain conditions).

As soon as you start receiving a pension and decide to work as a self-employed person, you automatically acquire the status of ‘self-employed pensioner’.

What is a self-employed pensioner?

A self-employed pensioner is someone who receives a pension and works as a self-employed person at the same time. Therefore, you cannot choose this status yourself; it is determined based on your situation. Similarly, there are also ‘self-employed students’.

Why is this status important? Your taxes and social security contributions are calculated on the basis of your status. In concrete terms, the status of self-employed pensioner means the following:

• Your social security contributions are lower;
• You do not accrue any new pension rights;
• As a pensioner, you can start your own business and still retain your pension.

To get started as a self-employed pensioner, you must therefore establish a business. Most pensioners opt for a sole proprietorship, because this is simpler and cheaper than a corporation.

How much can you earn as a self-employed pensioner?

The rules depend on your age and your career:

• Are you 65 or older? Then you can earn unlimited additional income, regardless of how many years you have worked.
• Are you younger than 65, but have you already completed 45 years of career? Then you can also earn unlimited additional income.
• Are you younger than 65 and do you not yet have a full career? Then there are income limits that you must take into account.

In the latter case, the maximum amount you can earn depends on your family situation, the type of pension, and the number of dependent children.

In this article, you can read all about how much you can earn as a self-employed pensioner.

What if you earn too much as a self-employed pensioner?

If you exceed the permitted additional income limit, this will have consequences:

• You will have to repay part of your pension or your pension will be completely suspended for that year.
• In the case of a family pension, your partner may lose their rights if you earn too much.

The consequences are therefore significant if you exceed this limit. That is why it is crucial to have your personal situation analyzed in advance by the Federal Pension Service.

What are the advantages of entrepreneurship after retirement?

There are many advantages to entrepreneurship as a pensioner. Now that you have a lot of time on your hands, you may be looking for a new challenge. Because you retain your pension, there is little risk involved, and you can finally make your dream come true.

What’s more, entrepreneurship provides:

• Extra income: supplement your pension at your own pace
• Flexibility: you choose how much and when you work
• Mental stimulation: stay busy doing something you enjoy
• Sharing knowledge: pass on your experience to a new generation

How do you start your own business after retirement?

Launching a self-employed activity in 5 steps

As a self-employed person, you can choose between a corporation and a sole proprietorship. Almost all retirees opt for a sole proprietorship, which is why we will take a closer look at sole proprietorships in this article.

🤔 Would you like to read about all the differences between a sole proprietorship and a corporation? Then you can check out this article.

Setting up a sole proprietorship as a retiree is the same as for any other starter. The 5 steps are:

1. Registration with the CBE via an enterprise counter

2. Activation of your VAT number (if applicable)
3. Applying for any necessary permits (e.g., hospitality, itinerant trade)
4. Joining a social insurance fund
5. Taking out insurance (such as professional liability)

What about taxes and social security contributions?

Taxes: your pension and additional income are added together

Your self-employed income is added to your pension. This may put you in a higher tax bracket. But don’t worry! Since we have a progressive tax system, you will always end up with more money. After all, you only pay more tax on the part that falls into a higher bracket.

Fortunately, as a self-employed person, you can also deduct professional expenses to reduce your taxable profit.

Social security contributions for self-employed pensioners

Even as a pensioner, you must pay social security contributions on your self-employed income. The contributions:

• are calculated based on your net taxable income
• are lower than for active self-employed persons
• do not allow for additional pension accrual

Do you earn less than a certain amount? Then you only pay minimum contributions. Do you earn more? Then this will be adjusted via a recalculation.

ℹ️ It may be interesting to know how your social security contributions are calculated. We tell you more about this in this article.

What about your accounting after retirement?

A common concern is: “Can I still do all that accounting myself?” Fortunately, the answer is: yes, you can! In the past, self-employed people only worked with accountants, but now there are many more options for doing your own administration.

With Dexxter, you can easily do your own accounting as a retiree, even if you don’t know anything about it yet. You’ll get help with:

• creating invoices
• tracking income and expenses
• automatically submitting your VAT returns
• preparing your tax return

🎉 Don’t know anything about accounting? No worries! Dexxter has launched a free accounting course. In just a few hours, you’ll learn how to do your own accounting, without an accountant and without any prior knowledge.

In a nutshell

As a retiree, you can become or remain a self-employed person, provided you know the rules. The most important things to remember are:

• From the age of 65 or after a career of 45 years, you can earn unlimited additional income;
• If you earn too much while on early retirement, you will lose (part of) your pension;
• Your social security contributions are lower, but you do not accrue any new pension;

You can easily do your own accounting with a tool such as Dexxter.