Kistemaker comments:
Perhaps it is better to link the words "by this" [in this way] to the preceding verses. Because we love, we live in God and he lives in us; "by this, love is made complete among us."
While believers are not saved
by their own works (Eph. 2:8-9) but only by the work(s) of the Son (John 15:13; Rom. 5:8; 1 Cor. 1:18-25; 15:3; Col. 1:13-14, 19-20, 22; Heb. 9:26; cf. Mark 10:45; 1 Pet 2:24), they are saved
unto good works (Eph. 2:10; Tit. 2:14) and in maintaining these works it affirms their confidence. Even though believers are not like Christ in terms of the completeness of their obedience (1 John 4:15), they are like him in their basic orientation, and they stand out as Christ did in contrast with the world at large (John 5:44; 17:16). See BC 37.
John emphasizes the importance of love by speaking of it within the context of the last day, specifically the day of judgment (1 John 2:28). See "The Plan of the Ages: Are We in the Last Days?" John Gill remarks:
. . . not of men's judgment, when brought before judges, governors, and kings, for the sake of Christ and the Gospel, and stand at their bar, where saints, who have true love to God and Christ and the brethren, have stood with great courage and intrepidity, and shown much boldness, and used great freedom of speech; nor of judgment in this life, which sometimes begins at the house of God, though the saints often have great boldness and presence of mind, and freedom of expression both to God and man in a day of affliction, as Job had; but of the future judgment, which, though it will be very awful and solemn, Christ the Judge will appear with great majesty and glory, and all men will stand before him, and the books will be opened, and the judgment will proceed with great strictness and justice, and will issue in the everlasting perdition of devils and wicked men, yet the saints will have boldness in it: while evil men and devils tremble at the thoughts of it now, they rejoice and are glad; they love it, look for it, long for it, and hasten to it; and will stand fearless, and without the least dread, while others will flee to the rocks, and into the holes of the earth; and they will use freedom of speech with Christ, as the word here signifies; they will sing his new song, and ascribe the glory of their salvation to him, and express their praises of him, and love to him, then and to all eternity: and this boldness the saints may be said to arrive at through a perfect, or sincere, and genuine love of the brethren; for by this they know they are born again, and are born to an inheritance incorruptible, which they have both a meetness for, and a right unto; and knowing hereby that they are passed from death to life, they justly conclude they shall not enter into condemnation, and therefore are not afraid of the awful judgment: hereby they know that their faith is right, and that therefore they are manifestly the children of God; and if children, then heirs, and so shall be saved, and have everlasting life.
made perfect… day of judgment. See BC 37. In this verse and the next, John makes his third and fourth references to perfection or mature love for God. The first was in 2:5, where obedience made this love perfect, complete or mature. The second was in 4:12, where God's love matures as believers practice their love for one another. This leads to the final perfection of God's love—Christians can face God's final judgment without fear. In his Gospel, John describes Jesus as God's final agent of judgment (see notes on Jn. 5:22, 27, 30; 8:16; 12:31-33). Those who live or abide in him need not
fear punishment from him.