Today, employees can choose the most attractive companies. If companies offer tax-free salary perks—such as e-bikes or commuter tickets—they should advertise them. (Photo: © stylephotographs/123RF.com)
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February 2026
Is better team cohesion your New Year's resolution? Companies have numerous ways to motivate their employees with tax-free salary extras and promote shared experiences.
Today, companies must do everything they can to build a reputation locally, regionally and, depending on the industry, even nationally as attractive employer To find good people and avoid losing their well-trained workforce to industry or other economic sectors. Flexible and family-friendly working hours, continuing education opportunities, a positive team atmosphere, and modern work organization are becoming increasingly important. But financial considerations also play an important role.
Many companies offer tax-free extras that give employees more net pay without increasing their payroll taxes. Even though money and gifts no longer play the primary role in employee loyalty as they once did, word still gets around whether an employer provides an e-bike, contributes to a public transport pass, offers health courses, or orders pizza for the team when overtime is necessary.
Workwear; Employer loans; Employer-funded pension; Company holidays; Company cars; Recreation allowance; Eating as a team; Cycles; Training costs; Fitness; job ticket; personal occasion; License plate advertisingg; Charging stations, Mahlzeiten; rent; Emergencies; Fruit and drinks; Staff discount; Restaurant checks; Non-cash benefits; Smartphones; Moving costs; Tool money; subsidy for kindergarten
Employers can fully or partially reimburse the costs of typical work clothing, such as protective clothing for tradesmen and women, tax-free. However, the tax office requires that the professional or work clothing is specified in the employment contract or collective agreement, that it is legally required protective clothing, and/or that it is typical work clothing, as is the case for chimney sweeps, cooks, pastry chefs, butchers, or doctors. The rules are quite strict. For years, the question of whether the black suit worn by undertakers also counts as typical work clothing has been controversial. There is a Judgment of the Federal Finance Court
Operations management
Operations management
Operations management
Employers can support their employees in financial difficulties with a loan of up to 2.600 euros per year The monthly interest benefit, including any other benefits in kind, must remain below the 50-euro limit per month.
Employees who have a company pension plan (bAV) with deferred compensation are legally entitled to a subsidy from their employer, regardless of when the contract was concluded. Until the end of 2021, the mandatory employer subsidy only applied to new contracts; since January 1, 2022, existing contracts must also be supported.
Employers must now Subsidy of 15 percent for each bAV if this is done in the form of salary conversion through a direct insurance policy, a pension fund, or a pension fund. The Chambers of Crafts and Skilled Trades are available to assist their members with questions on this topic.
Additional service! Only genuine additional benefits provided by the employer are tax-privileged. Salary bonuses are only considered "in addition to the wages already owed" if the benefit is not credited toward the wage entitlement, if wages are not reduced in favor of the benefit, if the benefit is not granted in place of an already agreed-upon future wage increase, and if the wage increase is not increased if the benefit is no longer paid (Federal Ministry of Finance letter dated February 5, 2020).
At company celebrations, the employer may EUR 110 The allowance can also include the cost of an overnight stay. It's important that the celebration is open to all employees. Two company events per year are possible, for example, a Christmas party and a summer party.
It only needs to be 110-euro allowance What the participants can consume must be included. This includes food, drinks, and, for example, performances by a musician. Venue rental or the event planner's salary do not need to be included. If spouses or children are also invited to the celebration, the costs incurred by their dependents are allocated to the respective employee.
Bosses can provide their employees with a company car. This, of course, is subject to tax (a non-cash benefit). Because the topic is very complex, here's just a brief note: There are two methods: a flat-rate taxation based on the 1 percent method (or 0,5 or 0,25 percent for electric vehicles) or based on actual usage using a logbook.
A tax-free pocket money for vacation Employers can donate up to €156 per year to an employee (voluntarily) as a recreation allowance. An additional €104 is added for the spouse or partner, as well as €52 per child. For a married employee with two children, this is 364 euros per year – tax-free! The employer pays a flat rate of 25 percent in taxes. All social security contributions are waived for the vacation allowance.
More and more companies are providing their employees with a bicycle or e-bike in addition to their salary for commuting between home and work, as well as for personal trips. This non-cash benefit for personal use is tax-free until 2030. It is also not credited towards the commuter allowance when filing their tax returns – unlike the tax-free job ticket.
However, the tax exemption does not apply to e-bike leasing financed through salary conversion. Electric bikes classified as motor vehicles under traffic law (speeds over 25 km/h) are also exempt. To assess the non-cash benefit, the company car taxation regulations must be applied.
What applies to employed spouses?Employed spouses or children over 15 are also allowed to receive tax-free salary bonuses, such as a tax-free non-cash benefit of €50 or a smartphone. As always with employment contracts between spouses, the arm's length approach is important. "No boss would allow a mini-jobber to use a vehicle entirely for private purposes. Therefore, the tax office will object if a married couple wants to declare their privately used car as a company car for the marginally employed spouse on their tax return," emphasizes the wage tax assistance association VLH.
The costs of continuing education and training can be covered tax-free if the measure is clearly in the employer's interest. A Spanish course as a reward is not eligible, unless the employee is planning an extended stay on an assembly line in Mallorca for the company.
The employer must be the invoice recipient or provide written confirmation of reimbursement prior to the training. Driver's license: In most cases, a driver's license is a private matter. Therefore, the costs cannot be reimbursed tax-free.
However, if an employee in a skilled trades business requires a Class C1/C1E driver's license for vehicles between 3,5 and 7,5 tons, employers can reimburse the driver's license bill tax-free. However, this only applies to the costs or additional costs for Class C.
Daily work on a construction site, in a workshop, or at a computer puts a strain on every body. Stress, deadline pressure, and one-sided working postures all take their toll. Employers can do their employees good through health promotion and preventative measures.
Company-sponsored measures for health promotion and the prevention of occupational diseases, from back training to nutritional advice, are tax-exempt – up to a maximum of 600 euros per year. However, they must be specific and certified measures act.
These include courses on relaxation and stress management, back exercises, nutritional advice or smoking cessation, and further training in the areas of health and work design. Course offers On the website of the GKV-Spitzenverband Employers can find certified courses on the websites of health insurance companies. Federal Ministry of Health provides information on prevention.
Companies interested in workplace health promotion can contact a health insurance company – ideally one that covers part of their workforce. Health insurance companies also have lists or links to certified programs on their websites, or they offer their own Corporate Health Management
Alternatively, the employer can set up a fitness room on site (tax-free and fee-free) or, under strict conditions, offer gym membership. However, the latter is significantly more complicated and rarely recommended by tax experts.
Employer subsidies for the use of local public transport (ÖPNV) between home and work (primary place of work) are tax-free. Reduced-price or free job tickets, such as monthly or annual tickets or the Deutschlandticket (Germany Ticket), are also not included in the €50 non-cash benefit allowance.
However, subsidies for commuting by bus and train are only tax-free if they are paid in addition to the employee's salary. The tax exemption does not apply to salary conversions. Employer subsidies for taxi rides or flights are not tax-free. However, if the employee uses the job ticket for private journeys, it remains tax-free.
The Deutschlandticket can also be made available to marginally employed persons (mini-jobbers) – with all other applicable tax and social security benefits, as the IKK classic The ticket does not affect social security contributions.
The employer can give a generous gift for a wedding, birthday, company anniversary or the birth of a child (i.e. a special personal occasion).
The tax office's requirement is that no cash is given as a gift and that the 60 euro limit is not exceeded, otherwise the entire service becomes subject to tax. Shipping costs are included in the value of the tax benefit.
If the gift is larger, there's the option for the boss to cover the employee's flat-rate income tax. This can be discussed with your tax advisor.
If an employee has a child shortly after their wedding, they are allowed to give them such a gift twice a year. "Because these are completely separate events, there is no monetary benefit for the employee, allowing them to fully enjoy the gifts," says HR expert Birgit Ennemoser, author of the Datev guide "Salary Extras."
By the way, Christmas or Easter are not considered personal occasions, as these holidays apply to everyone.
New since January 1, 2023: The regulation now only applies to employees and their family members living in the same household. Gifts are permitted up to a value of EUR 60 are only tax-free if they are granted to the employee himself or to a relative who lives with the employee in the same household. For example, wedding gifts from the employer to a child not living in the employee's household not subject to tax exemption.
Some employers offer their employees the opportunity to have a company advertising sticker on their private vehicle, paying up to €21 per month or €255,99 per year. This is the maximum amount permitted by income tax law. However, very strict regulations must be adhered to, such as the Federal Finance Court decided. Otherwise, license plate advertising will become a tax trap! How to be on the safe side when it comes to license plate advertising, read herer
Charging electric vehicles at the employer's premises is exempt from income tax. This also applies if the employer provides the employee with a company charging device for use, for example, at their place of residence.
If the employer provides meals to its employees or, for example, provides a meal at a reduced price in a canteen, this is considered part of the remuneration. However, in the payroll, such meals are included in the Non-cash benefits The values are adjusted annually to reflect consumer prices. The value for lunch and dinner in 2026 is €4,57 each. The value for breakfast is €2,37. The total monthly value for meals is €345.
To plan a large construction project, employees have to work longer hours; during a full-day training session, there is no time for a long lunch break.
On such occasions, the employer may treat his team to a meal and, for example, order pizza for everyone.
The costs per employee may EUR 60 do not exceed, then the meals are tax and social security free.
The non-cash benefit value for rent or accommodation this year (i.e. 2026) is EUR 285 in the month.
In case of serious illness, an accident, a fire or a health cure, the employer may provide his employee with EUR 600 tax-free. If the company has more than five employees, there are a few formal requirements for the Emergency aidthat the tax advisor knows.
Employers can provide their employees with free water, coffee, and cookies for consumption on the premises. This is tax-free up to an unlimited amount. Even a basket full of dry rolls, croissants, or pretzels should be acceptable to the tax office. Fruit baskets, for example, provided by the boss for consumption at work are considered expenses "for services to improve general health and workplace health promotion" and are tax- and social security-free up to €600 per employee per calendar year (Section 3, Number 34 of the Income Tax Act). But: The tax authorities classify sandwiches as benefits in kind.
Companies can offer employees annual benefits amounting to EUR 1.080 Every euro above this discount allowance is subject to tax and social security contributions. Read more about this here
The boss can co-finance lunch at a restaurant or even at the supermarket. Restaurant vouchers up to 7,67 Euro (2026) remain tax-free for the employee if the employer taxes 4,57 euros (benefit in kind value) at a flat rate of 25 percent or the employee pays this amount himself.
It's important that the check is only used for meals or for food that can be consumed immediately during the break. The tax authorities require that only one voucher be used per day for such vouchers. If a maximum of 15 meals are paid for per month, the business owner saves himself the trouble of monitoring the vouchers' redemption. A restaurant visit on the weekend is out of the question.
The tax-free limit for benefits in kind is 50 euros per monthAll employees, including trainees and mini-jobbers, can receive this amount tax-free on top.
However, in 2022, the requirements for tax exemption for voucher or prepaid cards have become significantly stricter than before. Vouchers and cash cards that can only be used to purchase goods or services are considered non-cash benefits. Furthermore, they must meet certain criteria of the Payment Services Supervision Act (ZAG) to avoid being considered cash wages. The more a voucher resembles money, the more likely it is to be subject to tax and social security contributions. "Vouchers and cash cards will only remain exempt from income tax if they can be used in certain stores, chain stores, shopping centers, or at acceptance points with a defined product range," explains the Taxpayers' Association. Vouchers for books, newspapers, and audiobooks are also eligible.
Vouchers and debit cards that can be used anywhere, so-called open-loop cards or cards that can be redeemed without restrictions at an online retailer, are no longer considered tax-free salary perks. However, "the fees borne by employers for providing (such as setup fees) and topping up vouchers and debit cards are no longer considered a non-cash benefit," reports tax advisor Claudia Lobmeier from the law firm Ecovis.
The advantage of vouchers for employees is that they don't have to spend the amount they receive in the same month. This allows them to save the money for a larger purchase. As with most tax-free perks, it's important that the non-cash benefit is granted in addition to the salary already owed. Employees may not receive the voucher in exchange for a salary sacrifice or as a salary conversion. Furthermore, all non-cash benefits in a given month are added together, and any unused amounts may not be carried over to other months.
Employees can use the company iPad, laptop, computer, printer, and smartphone at home. All of this remains tax- and social security-free, even if the foreman, journeyman, or apprentice uses the technology only for personal use. However, the devices must either remain the property of the company or be leased from the company, for example. In any case, the employee may not receive them as a gift. This would again be subject to income tax at a flat rate of 25 percent.
Many employers contribute to relocation costs if the new employee has to relocate. Employers have several options to support applicants. For example, they can cover relocation costs tax-free, up to a maximum of the relocation allowance. Since March 1, 2024, this has been EUR 964The employer can also reimburse double rent payments tax-free for a certain period or finance temporary accommodation. Read more about this here
The so-called tool allowance, which employers pay their employees to compensate for the wear and tear on their own tools, is tax-free. This applies to hand tools used to facilitate the handling, processing, and working of an object, such as hairdressing scissors. The Federal Fiscal Court (BFH) has accepted an allowance of €50 per month (BFH, August 21, 1995 - VI R 30/95).
If you have any questions about Topic of "employer attractiveness" The advisory teams at the Chambers of Skilled Crafts are available to help. Marketing or succession consulting, for example, can help convey the company's current high status as an attractive employer. The Chambers of Skilled Crafts also assist with risk assessments. Health insurance companies can provide assistance with questions regarding health courses or occupational health management.
The entrepreneur has a free hand if he offers his team an employer’s allowance for the Care for children not of school age He can reimburse as much as he wants – social security contributions and taxes are generally not payable on the benefit. It is important that the child is not cared for at home, but rather in a daycare center, after-school care center, or with a childminder.
The original invoice must be submitted to the employer each year. The employer must add the invoice to the payroll account. This is to prevent the costs from being claimed twice on the income tax return.
Recommended readingBirgit Ennemoser: Guide to Salary Extras. Opportunities for Compensation Optimization – Support in Employee Recruitment and Retention11th edition, 2025, Datev-Verlag, ISBN 978-3-96276-135-6.
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