The lump-sum wage taxation according to §37b EStG offers employers the possibility to tax certain benefits in kind to employees with a uniform tax rate of 30%.
There is a choice between taxing the benefits in kind at the employee’s individual tax rate or lump-sum taxation, in which the employer bears the amount of payroll tax alone.
Read which benefits in kind can be taxed at a flat rate and what you need to bear in mind.
Which benefits in kind can be taxed at a flat rate?
- Reward meals (above the EUR 50 non-monetary benefit exemption limit)
- Incentive trips
- Gifts to employees (not attentions) and business partners.
When may the flat rate of 30% not be applied?
The flat rate may not be applied if the expense per recipient and financial year or the individual benefit per year exceeds the amount of EUR 10,000. In these cases, the exceeding amounts must be taxed according to the employee’s individual tax characteristics.
What must be taken into account?
The decision as to which type of taxation is to be chosen must be made by the deadline applicable to the transmission of the electronic wage tax certificate – i.e. by February 28 of the current year at the latest for the previous year.
Important: If employers do their own accounting, these invoices should be forwarded to the payroll office in order to check whether the lump-sum taxation is necessary.
Benefits in kind, which are taxed at a flat rate of 30% according to §37b EStG, are subject to contributions for own employees.
Do you still have questions on the subject of flat-rate payroll tax?
Fachbereichsleiterin Lohn und Gehalt
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