Additional tax-free employer benefits from 2019

As part of an amendment to the law, improvements are planned for employer benefits in connection with the employee’s journeys from home to the place of work (first place of work) or for private journeys:

• As of January 1, 2019, employer allowances are exempt from wage tax and social security contributions if they are paid in addition to the wages owed anyway for travel by public transport on scheduled services and local public transport. The same applies to the free or reduced-price use of public transport on regular routes (so-called job tickets). These tax-free benefits reduce the deductible commuting allowance. The employer still has the option of a flat-rate wage tax of 15% for benefits in kind provided by the employer with regard to the employee’s transportation between home and the first place of work or for subsidies to the employee’s corresponding expenses (Section 40 (2) sentence 2 EStG). In the future, this regulation will continue to have significance for the use of non-public means of transport.
• From 2019 up to and including 2021, benefits granted by the employer for the use of a company bicycle will also be exempt from wage tax and social security contributions. This also includes the so-called e-bikes, for which there is no obligation to mark and insure (with motor assistance up to 25 km/h); the e-bikes subject to registration are excluded from the tax exemption.

(For further comments, information and examples, please refer to our Information Letter 01/2019).

Neumann & Walczak – tax consulting company GmbH – Robert-Bosch-Strasse 1 – 59439 Holzwickede

Neumann & Walczak Tax Consultants – Partnership –
Robert-Bosch-Strasse 1 – 59439 Holzwickede

Website: www.neumann-walczak.de – E-mail: info@neumann-walczak.de

Phone: (0049) 02301 – 91 291 0 – Fax: (0049) 02301 – 91 291 21