Coronavirus: Employee allowances are tax-free up to EUR 1,500 during the corona pandemic

In times of the corona pandemic, in Germany, special payments for employees up to an amount of EUR 1,500 will be made tax and social security free in 2020.

Employers can now pay subsidies up to an amount of EUR 1,500 tax-free to their employees or grant them in kind; allowances employees receive between March 1, 2020 and December 31, 2020 are entitled.

The precondition is that the allowances and grants are paid in addition to the wages owed anyway. The tax-free benefits are to be recorded in the salary account. Other tax exemptions and valuation relief remain unaffected. The subsidies and grants remain free of social security contributions.

Since it is not possible to differentiate between professions, the tax exemption applies to all allowances up to a total of EUR 1,500 above the agreed wages.

Please contact us for further information.

Source: NWB, BMF Online

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