Pension of 870 euros will have a net increase of 643 euros in 2025.

Pension values will increase in 2025 due to various factors.

The increase in pensions and changes to the IRS planned for January 2025 will allow a pensioner with a retirement pension of 870 euros to receive an additional 643.72 euros net throughout the year, compared to 2024.

According to simulations carried out by the EY consultant and shared by Notícias ao Minuto, estimates consider the regular increase in pensions in 2025; the additional 1.25 percentage points for pensions up to three times IAS (about 1,567 euros), included in the OE2025, and the impacts on IRS, such as the increase in specific deduction, updating of tax brackets, and minimum existence.

For the calculation, it was assumed 250 euros in general family expenses.

Simulation for a pension of 870 euros

In 2024, a gross reform of 870 euros increases to 903 euros in 2025, resulting in a gross annual increase of 468.9 euros. The annual net income of this pensioner rises from 11,785.75 euros in 2024 to 12,429.47 euros in 2025, translating to a net increase of 643.72 euros.

Simulations with larger pensions.

• Pension of 1,500 euros: Net increase of 620.43 euros, driven by a gross update of 735 euros and changes in IRS;

• Pension of 2,500 euros: Net increase of 691.47 euros;  

• Pension of 3,500 euros: Net increase of 903.44 euros. 

Notice that the full impacts of changes in the IRS will only be felt after the annual tax return is filed, as the withholding tax does not automatically reflect all tax changes or deductions that can be claimed by taxpayers.

These changes, combining updates to pensions and tax breaks, will result in an increase in purchasing power for retirees in 2025.

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