Increase in pensions in January: Here are the new amounts

The mechanism is called indexation or automatic equalization, or even revaluation: pensions of all social security and welfare categories are tied to the value of the increase in consumer prices recorded by Istat every year. INPS adjusts the amounts accordingly each year. The adjustment is initially made based on an estimated Istat index, then adjusted to the exact value in January of the following year (this year it was moved to December). There is an innovation in the 2024 budget law regarding the revaluation of high-value pensions. The change only concerns the class of amounts exceeding 10 times the INPS minimum payment: the revaluation rate for these pensions is set at 22% instead of 32% as in 2023.

So what about other retirees? Let’s see in detail the increases due to inflation adjustment of treatments starting from January 1, 2024, band by band, from lowest to highest. Pensions equal to or less than 4 times the minimum amount, i.e. up to 2,272.76 euros, will be revalued at 100%, as stated in the decree signed by Minister of Economy Giancarlo Giorgetti and Minister of Labor Maria Elvira Calderone: in case of full revaluation, the check will be 5.4% It will be equal to . An example of an amount: 1,500 euros gross monthly pension x 5.4% = 1,581 euros gross monthly. But for higher ones, the percentage decreases as the amount increases. Pensions that are 4 to 5 times the minimum amount and whose allowance varies between 2,271.76 and 2,839.70 euros will be revalued by 85 percent. In this case, the actual increase is 4.59%. Here is a practical example: 2500 euros x 4.59% = 2614 euros pension, always gross monthly.

The revaluation of pensions at 5 to 6 times the minimum amount from 2,839.70 euros to 3,407.64 euros will be 53%, an increase of 2,862%. Example: 3000 euro pension x 2.862% = 3,085.86. Pensions that are 6 to 8 times the minimum amount, ranging from 3,407.64 to 4,543.52 euros, will be evaluated at 47 percent, an increase of 2,538 percent. Practical example: 4,000 euros x 2.538% = 4,101.52 euros pension. The value of pensions, which are 8 to 10 times the minimum amount, will increase from 4,543.52 to 5,679.40 euros, an increase of 1,998 percent and 37 percent. Example: A pension of 5000 euros x 1.998% = 5,099.9 euros. And finally, pensions over 10 times the minimum with checks exceeding 5,679.40 will have a 22% revaluation, with an effective increase of 1.188%. Example: 6000 euro pension x 1.188% = 6.071.

In the communication regarding the January 2024 payroll, INPS did not mention possible delays in the payment of increases (as happened last year with payments exceeding 4 times the minimum). Therefore, unless there are last-minute surprises, raises for all retirees will start from this month. Social Security Institution announced that the payment will be made as of Wednesday, January 3.

Irpef reform: what will happen to pensions

Another small increase in 2024 will occur thanks to the realignment of Irpef rates (from four to three). Considering that personal income tax is paid by everyone with income, it is clear that the Irpef reform will also benefit retirees (like workers). In this case, the calculation is less simple, as is the relative increment, because it is essentially a concatenation of the first two parentheses. The income range of €15,000-€28,000 will no longer exist and will be merged with the income range of up to €15,000. The new scheme is as follows:

• In the first band, up to 28 thousand euros of annual gross income will pay 23% of Irpef;
• in the second band, it will pay 35% of the annual gross income between 28 thousand and 50 thousand euros of Irpef;
• The third group, whose annual gross income is over 50 thousand euros, will pay 43% of Irpef.

The annual tax advantage will be 200 euros for those with an income of 25 thousand euros, and will increase to 260 euros for incomes above 28 thousand euros. For people whose total income exceeds 50 thousand euros, there should be a linear cut in deductions of 260 euros, which (above this threshold) would nullify the effects of the reform; Workers whose income is below 15 thousand euros will be able to benefit from this aid. Increase in deductions from income from work (from 1,880 euros to 1,955 euros).

But at the same time, the Irpef regulation will be reflected in the payrolls: the final recalculation of withholdings was carried out solely on the basis of the total amount of retirement benefits paid by INPS. If less than the amount due on an annual basis is deducted, the debt differences will be collected from the January and February 2024 retirement installments as usual.