Many employers would like to provide financial assistance to their employees who have been affected by environmental catastrophes. The following payroll tax simplifications apply to support affected individuals:
Affected employees can receive up to EUR 600 per calendar year tax-free from their employer as aid and assistance. If the aid is paid out to affected employees due to an extraordinary emergency situation, an amount exceeding EUR 600 is not part of taxable wages.
Further financial support for persons affected
Tax-free interest subsidies
To repair damage – for example to owner-occupied property – loans often have to be taken out. Here, the employer can provide tax-free interest subsidies or interest benefits. These benefits apply for the term of the loan, but the loan must not exceed the amount of damage.
In addition, after the occurrence of the unforeseeable damage, the employee may be granted free meals and the use of an apartment or accommodation. If an employee’s car was destroyed in connection with the flood disaster, the employee may be given a company car to use. These benefits are included in the tax-free amount of EUR 600 per calendar year.
All subsidies or non-cash benefits are only tax-exempt up to the actual amount of the damage and must be recorded in the payroll account for each affected employee with reasons.
Furthermore, employees can waive the payment of wages in favor of an aid or support payment by the employer to affected employees or a monetary donation by the employer in favor of an eligible aid organization.