NEWS

13.08.2019

Incentives – exempt from income tax and social security contributions

VAT-News

As an employer you want to reward your employees for their good performance and motivate them to higher commitment for your company.

A good possibility to achieve this goal is by granting a wage increase. However, the increase has a certain disadvantage: it leads to higher income tax and a higher social security contribution for both you and him. That means that the employee finally gets only a part of the granted wage increase.

An alternative are incentives that can be granted free of income tax and social security contribution and thus are advantageous for both employer and employee.

Possible additional salary components are:

-       Benefits in kind of maximum 44,00 € per month

-       Private use of a company car

-       Transportation allowance for travel by public transport between domicile and first workplace

-       Private use of computers, data processing equipment and telephones (even at home); the equipment remains property of the employer

-       Subsidies of up to maximum 500,00 € per year for certified performances to improve the general health (e. g. courses for back exercises, for healthy nutrition, for stress management etc.)

-       Childcare costs for children not yet of school age

-       Parking at no costs or at reduced costs

There are multiple possibilities for a reward.

We will be pleased to advise you on the most profitable options for you and your employees.