German Passport – How it Affects your Pension and Taxes Even After Moving Back to Kenya

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Many Kenyans who’ve lived in Germany get to that point where you wonder whether or not to take up German citizenship. The advantages of taking up the German citizenship are advertised everywhere but rarely do you have people mention the disadvantages of taking up the red passport. Here are a few:


I bet you know all the usual ones everyone advertises: easy travelling, no visa extensions, evacuation from war areas, voting etc. But I’d like to mention one on pension:

  • Pension paid out remains same regardless of where you decide to live after retirement (As a foreigner your pension reduces by 30% if you decide to move and live outside the EU)


Many of the disadvantages “disappear” because you’re still Kenyan when you have a Kenyan ID or Passport in Kenya e.g. Paying for a visa when entering Kenya, Leasing land (foreigners can’t buy land, only lease it).

The disadvantages that remain in this case are those pertaining to the German government “following” their citizen:

  1. As a German living and working in Kenya, you will have to pay taxes on your income and capital to the German government based on the DBA treaty between Kenya and Germany. The DBA ensures you don’t pay taxes twice, but for the taxes that are only in one country then you have to pay e.g. In Kenya you don’t pay inheritance tax, but in Germany they do so as a German you have to pay this tax regardless of your country of residence. (Read more at Double Tax Agreement between Kenya and Germany.) This differs from the US in that, for the US all their citizens have to pay full taxes to the US government regardless of their location. Germany allows you to pay tax only once, either to the Federal state or to the country you live in.
  2. Working in Kenya means you have no right to the social insurances workers in Germany generally pay for. If you move to Kenya and work there, on returning to Germany, the time spent in Kenya is not calculated as they decide whether or not you’re legible to Arbeitslosengeld (Unemployment benefits).
  3. As a pensioner, moving outside the EU and to a counter without a bilateral agreement with Germany, means you lose your right to  public Health and Nursing Care Insurance from the federal state, this also applies to an optional health insurance from a German insurance company.

For more info read: Deutsche im Ausland

You can read more about: Kenya’s Dual Citizenship – disaster in the making or blessing in disguise?

You can also read how that affects you in starting a business in Kenya: Investment Forum in Köln.

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