Short answer: A payout before the payout phase starts is, under section 93 EStG in the version available today, generally harmful use. The allowances and the amounts determined then have to be repaid. A transfer to another pension contract is not harmful use under section 93 subsection 2 EStG. From 2027 the rules of the pension reform act apply to the Altersvorsorgedepot (last updated: November 2026).
Many savers think first about whether they can get the money back in an emergency. The answer is not simply yes or no. What matters is whether the payout counts as harmful use, because then the state subsidy must be repaid. This guide explains the rules, shows typical situations and names steps that help you prepare a decision.
The most important points
- A payout without a statutory ground before the payout phase starts is generally harmful use under section 93 EStG.
- The allowances and the amounts determined under section 10a subsection 4 EStG must then be repaid.
- A transfer to another pension contract is not harmful use.
- Without a different agreement the payout phase starts at 65, for contracts concluded after 31 December 2026.
- Before you decide, have the repayment amount shown to you in writing.
When does the payout start normally?
Without a different agreement the payout phase starts on reaching age 65, provided the contract was concluded after 31 December 2026. Anything before that is the exceptional case this guide covers. A payout within the payout phase is the normal case and is not the subject of this question.
What is harmful use?
The term describes a use of subsidised assets that does not meet the legal requirements. The consequence is repayment. The law calls the amount to be repaid the repayment amount, which consists of the allowances and the amounts determined. The repayment therefore concerns the state subsidy and not only the sum you paid in yourself.
The term sounds strict but is mainly a rule of order. It is meant to prevent subsidies from being used for purposes other than retirement provision.
Situations and legal consequences
| Situation | Legal consequence under section 93 EStG | What to do |
|---|---|---|
| Payout before the payout phase starts, without a statutory ground | Harmful use, repayment of the allowances and determined amounts (subsection 1) | Ask the provider for the repayment amount before you request anything |
| Transfer to another pension contract | Not harmful use (subsection 2) | Request the transfer through the provider and compare the terms |
| Payout on death to third parties | Generally harmful, with exceptions (subsection 1) | Read the guide on inheritance and check the beneficiary designation |
| Payout within the payout phase | Normal case, not harmful use in this sense | Check the payout plan and the reference dates |
The table summarises only the basic rules. In individual cases further provisions can apply, so it is worth reading the statutory text.
What an early payout costs
The cost consists of the repayment of the subsidy and, depending on the contract, fees charged by the provider. The allowances form the fixed core of the repayment. An exact sum can only be determined with the provider and the amounts determined, not from a rule of thumb.
In addition there is the lost return on the money you no longer hold in the contract. This effect depends on the investment and on the remaining term, so it can only be described roughly.
Worked example of a repayment
Assumption: in recent years you paid in 8,000 euros of own contributions and received 2,000 euros of allowances. You want an early payout of 10,000 euros, and the payout counts as harmful use.
| Item | Amount (assumption) |
|---|---|
| Own contributions in total | 8,000 euros |
| Allowances in total | 2,000 euros |
| At least allowances to be repaid | 2,000 euros |
| Additional determined amounts | as stated by the provider |
The calculation shows the lower limit of the repayment. The amounts determined under section 10a subsection 4 EStG come on top and must be requested from the provider. A sum that will actually remain for you cannot be reliably derived from this.
Steps before a decision
- Have the repayment amount shown to you in writing before you request a payout.
- Check whether a transfer to another pension contract is the better solution for you.
- Clarify whether part of the balance can stay in the contract and what a partial payout would mean.
- If needed, get advice on the tax side, for example from a tax adviser.
How to assess the effects of a withdrawal
Before you request a payout, calculate in three steps. First the amount you actually need. Then the repayment that the provider states for this contract. Finally, whether the need can be met in another way, for example by a partial payout or by a contract that allows a transfer without repayment.
This order avoids the most common mistake, which is requesting a payout that turns out to cost much more than expected. Anyone who knows the repayment can better judge whether the advantage of immediate access outweighs the disadvantage.
Typical mistakes
- Submitting a termination before the repayment amount is in writing.
- Confusing a transfer to another contract with a payout, because the two have different consequences.
- Forgetting the allowances received in earlier years and looking only at your own contributions.
- Relying on an oral statement without having it confirmed in writing.
Frequently asked questions
What happens on termination?
Termination does not automatically end the contract without consequences. Whether it triggers harmful use depends on what happens to the balance. Check this before you terminate, not afterwards.
Are there exceptions to repayment?
The law provides exceptions, for example for a transfer to another contract, for survivors’ pensions and for the Altersvorsorge-Eigenheimbetrag (the amount for owner-occupied housing). Whether one applies in your case you must check, because the conditions are narrowly drawn.
Is a transfer possible without repayment?
Yes. Under section 93 subsection 2 EStG a transfer to another pension contract is not harmful use. The transfer runs through the provider, and you should have it confirmed in writing.
What applies to existing contracts?
Existing Riester contracts follow the earlier rules, unless the law provides otherwise. Whether and how a switch is possible is set by the contract. For new contracts from 2027 the rules of the reform act apply.
Related articles
- Retirement provision 2027: the overview of depot, Frühstart-Rente and Riester
- Payout plan in the Altersvorsorgedepot: what 20 years means
- Altersvorsorgedepot inheritance: rules on death
- Riester contract: keep it running or cancel it?
- Switching from Riester to the Altersvorsorgedepot: what it costs
Sources: Section 93 EStG, harmful use (version available today), Pension Contract Certification Act (AltZertG) in the version amended by the pension reform act (version from 1 January 2027).
Last updated: November 2026. This guide is general information, not individual advice.
