Flexible Retirement for Self-Employed Workers: What Changes Under the New Reform

The Council of Ministers has approved a reform of flexible retirement that introduces a significant change to the system governing the compatibility between work and pensions: for the first time, self-employed workers will be allowed to partially return to professional activity after retirement while continuing to receive part of their pension.

Until now, this arrangement was primarily intended for employees working part-time. Under the new regulation, the model is extended to self-employed workers and independent professionals, reinforcing the trend toward gradual transition schemes between working life and retirement.

The measure forms part of a broader package of reforms aimed at promoting active ageing and increasing the flexibility of the pension system.

What is flexible retirement?

Flexible retirement is a retirement scheme that allows a person who has already retired to resume part-time employment or professional activity while continuing to receive a portion of their pension.

Under this arrangement:

• The pension is reduced proportionally according to the working hours or level of activity carried out.
• The pensioner can supplement their income through compatible employment or professional work.

Its purpose is to facilitate a gradual withdrawal from the labour market, avoiding a complete break between active employment and retirement.

Main change: self-employed workers will be eligible for flexible retirement

The most significant aspect of the reform is the extension of this scheme to self-employed professionals.

From now on, self-employed workers will be able to combine their retirement pension with part-time professional activity, provided that certain requirements are met, including:

• Not having been registered as self-employed during the three years prior to retirement.
• Carrying out the activity under the flexible retirement compatibility regime.
• Adjusting working time or activity levels to the limits established by the regulations.

This change is particularly relevant for professionals who wish to maintain a reduced level of activity after retirement, such as lawyers, architects, consultants, advisers and other independent professionals.

Greater flexibility and financial incentives

The reform not only broadens eligibility but also introduces adjustments to the compatibility conditions.

The main developments include:

• Greater flexibility regarding the percentage of working time that can be combined with a pension, expanding the existing limits.
• The possibility of combining work and pension benefits from the moment flexible retirement begins.
• Additional financial incentives for those returning to work after a minimum period of inactivity.
• Adjustments to the pension amount depending on the degree of compatibility between work and pension.

The stated objective is to encourage partial participation in the labour market without fully giving up retirement benefits.

 

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How flexible retirement fits within the pension system

Flexible retirement forms part of a broader set of mechanisms that allow pensions and employment income to be combined, alongside other arrangements such as active retirement.

Its role is to facilitate a gradual transition towards full retirement, particularly in cases where the individual has already left their main occupation but wishes to maintain a certain level of economic activity.

Flexible retirement vs. active retirement: key differences

Although both schemes allow individuals to combine work and pension income, they are based on different principles.

In summary:

• Flexible retirement: accessed after retirement and allows part-time work, with a proportional reduction in the pension received.
• Active retirement: allows individuals to continue working after reaching the statutory retirement age, under a specific compatibility regime and with its own eligibility requirements.

In practice, active retirement remains the most commonly used option among self-employed workers who continue working beyond retirement age. This has led some experts to suggest that the actual impact of the flexible retirement reform may be limited.

Practical implications for self-employed workers and professionals

Beyond the legislative change, this reform has important implications for retirement planning among self-employed professionals.

Among the key aspects to consider are:

• Whether to continue or reduce professional activity after retirement.
• The impact on income and financial planning.
• The coordination between pension payments and income from professional activity.
• The legal structure under which the activity is carried out (sole trader or company).

In practice, deciding whether to continue working, reduce activity levels or combine work with a pension requires an individual assessment, as each option has different implications in terms of income, contributions and taxation.

A clear trend: more flexible and gradual retirement models

Recent pension reforms point towards a structural shift away from the traditional retirement model.

The system is evolving towards more flexible arrangements that allow individuals to:

• Extend their working lives voluntarily.
• Partially combine pension benefits with employment or professional activity.
• Adapt the transition into retirement to their personal and professional circumstances.

This approach reflects both demographic developments and the need to make better use of the experience and expertise of senior professionals in the labour market.

Do you need advice on retirement or Social Security matters?

At Adlanter, we advise self-employed workers, professionals and businesses on retirement planning and on optimising the compatibility between pension benefits and professional activity.

If you are considering how to organise your transition into retirement or continue working during this new stage of life, our team can help you assess the most suitable option for your particular circumstances.