Discounted use – gyms – employees

The granting of use free of charge or at a reduced price also

of fitness studios by the employer for its employees is a benefit in kind subject to wage tax and social security contributions, such as goods, vouchers or gasoline. If these benefits in kind do not exceed a total of 44 euros per month, they remain tax-free (Section 8 (2) sentence 11 EStG).

In a recent fiscal court ruling

The decision was made on how the non-cash benefit from the use of company fitness is to be assessed. In the case in dispute, a lump-sum payment was made for all employees during
The customer is granted nationwide use of the fitness studios belonging to the association during the term of the agreement.

In the opinion of the court, the non-cash benefit accrues to the participating employees on a monthly basis because the employer can withdraw the option to use the service at any time; this is not affected by a minimum contract term on the part of the employer. The average user charge of all Verbund facilities throughout Germany less the employees’ own contributions is to be used as a basis. In addition, an average admission fee must be taken into account for the initial term.

Compliance with the 44 euro limit should be ensured, because even slightly exceeding the monthly limit results in full liability for income tax and social security contributions.

(Further comments & information on this can be found in our information letter 07/2018 under the item 4.)