With savings plan payments, your employer supports you in saving and pays monthly into your savings plan. Under certain conditions, you can even receive state subsidies that are tax-free.
- What are savings plan payments (Vermögenswirksame Leistungen)?
- What is the employee savings subsidy (Arbeitnehmer-Sparzulage)?
- Taxes on savings plan payments and employee savings subsidy
- How to enter savings plan payments in the Taxfix app
What are savings plan payments (Vermögenswirksame Leistungen)?
Savings plan payments are voluntary additional payments made by an employer on top of your salary. The idea is that employees with lower incomes in particular get a helping hand to build up assets. In many professions, savings plan payments are regulated by collective agreements. But even in the case of non-tariff contracts, many employers have now opted for this payment to their employees.
In the case of savings contracts financed with these payments, a distinction is made between cash investments (participation savings), such as share funds or equity investments, and building society savings contracts. There are countless providers with different investment models, including those with a monthly minimum investment amount.
If you find a particularly interesting offer with an investment amount that exceeds what your boss is willing to pay, you can pay the remaining amount from your salary. The minimum limit for capital-forming benefits is 6.65 euros per month, the maximum amount is 40 euros per month.
If your employer is willing to pay you an additional 15 euros per month as capital-forming benefits, but you have found an interesting savings offer for 25 euros per month, you can contribute the remaining 10 euros from your salary.
What is the employee savings subsidy (Arbeitnehmer-Sparzulage)?
Savings plan payments are particularly worthwhile if the state subsidises your savings contracts with the so-called employee savings subsidy (Arbeitnehmer-Sparzulage). In the case of participation savings, this is 20% of your payments, up to a maximum of 80 euros per year. In the case of building society savings, this is 9% of your savings contributions, up to a maximum of 43 euros per year. If you are married and you are assessed together for tax purposes, the double values apply to you.
In order to receive the employee savings subsidy, you must fulfil two conditions:
- In order to be eligible for the state subsidy, your income must not exceed 20,000 euros for participation savings (40,000 euros for married couples). In the case of home loan savings, the income limit is only 17,900 euros (35,800 euros for married couples). The income limit only refers to the taxable salary. Your actual gross salary can therefore be higher. The more income-related expenses and special expenses you can claim in your tax return, the smaller the amount that is taken into account for the employee savings subsidy
- The savings contract must have a minimum term of 6 or 7 years. During this time, the amount saved may not be touched
You can also receive savings plan payments during your vocational training (Ausbildung / Lehre). Since your income during this time is usually below the income limit for the employee savings subsidy anyway and your tax burden is not as high, the capital-forming benefits is particularly worthwhile here.
If you change jobs, you can also continue the savings plan with the new company. If your new employer does not want to participate, you can continue to pay the savings contributions out of your own pocket or even set the current contract to "non-contributory".
Taxes on savings plan payments and employee savings subsidy
Savings plan payments are considered wages from employment and are therefore not tax-free. This means that they are added to your salary for tax purposes.
So if you receive 2,000 euros gross per month plus 40 euros in capital-forming benefits, you pay the tax rate for 2,040 euros per month.
The employee savings subsidy, on the other hand, is tax-free and must be applied for again each year in the tax return. The contributions of the savings plan are automatically sent to the tax office by your savings partner. Your savings partner, i.e. the company with which you have concluded the savings contract, sends the electronic capital formation certificate with all the necessary data and with your consent to your tax office by 28 February and, usually, to you as well.
How to enter savings plan payments in the Taxfix app
In the "Finances" category, you can indicate that you have received savings plan payments.
You do not need to enter any further details, as the contributions are automatically sent to the tax office by the provider of the savings contract. You do not need to enter the type and amount of savings plan payments you receive in the app. With this information, the employee savings subsidy is also automatically calculated and taken into account if there is an entitlement.