▷ Inexpensive public transport ticket thanks to tax advantages

25.10.2021 – 12:30

United Wage Tax Aid eV – VLH

Neustadt a. d. W. (ots)

Employees can save up to 30 percent on the annual public transport ticket: If, for example, the company pays the job ticket directly from the gross salary of the employees, they incur no further costs and at the same time the ticket is halved thanks to a tax advantage cheaper. For employees this means: They save on ticket prices and reduce their tax burden. How these tax-saving tickets and the commuter allowance are related is explained by the United Wage Tax Aid Association (VLH).

The following applies since 2020: The costs for annual public transport tickets can be taxed at a flat rate. The prerequisites for this are that the employer

  • processes the payment directly with the transport provider and
  • the employee (i.e. the user of the job ticket) deducts the amount plus flat-rate tax from the gross salary.

Employees have two options: with or without a commuter allowance

This procedure is a so-called salary conversion – and that can be taxed at 25 or 15 percent. In the first case, the employee can continue to deduct the commuter allowance as income-related expenses, i.e. 30 cents per kilometer one way to work (as of 2020).

In the second case, i.e. with the 15 percent variant, the flat-rate distance fee is reduced by the amount of the job ticket.

Pay the gross job ticket and reduce the tax burden

Anyone who reduces their gross income through the lump-sum taxation of the job ticket lowers their tax burden. This can be worthwhile for employees with a personal tax rate above 15 or 25 percent. And if the employer pays the tax, it pays off even with higher tax rates.

First example: Daniel is single, has no children, earns 3,000 euros gross a month and works in Mannheim, where the job ticket costs 45.20 euros a month. He neither pays church tax, nor does he enjoy any special tax advantages. At the end of the month, he gets around 1,970 euros net.

With the 25 percent flat-rate tax option, Daniel’s employer deducts the ticket price of 45.20 euros per month from Daniel’s gross salary and offsets the flat-rate tax against Daniel’s net wage. Daniel then receives around 1,934 euros net, i.e. 36 euros less per month – but receives a ticket that is worth 45.20 euros. Calculated over the year, it saves 110 euros.

Second example: There is no job ticket at Daniel’s employer. That’s why Daniel uses the Rhein-Neckar-Ticket for 89.80 euros per month with the same tax advantage. Daniel will then receive around 1,899 euros net, i.e. around 70 euros less per month. A savings advantage of 237.60 euros per year.

Basically, the more expensive the annual public transport ticket, the greater the tax-saving effect.

15 or 25 percent option? With or without a flat-rate distance allowance?

Which type of flat-rate taxation is more favorable for the individual employee depends on the distance to work. Because if you commute far, you benefit more from the distance flat rate than an employee who lives close to his first place of work. That means: if you can claim no or only a few costs via the distance flat rate, the 15 percent flat rate taxation is more favorable in terms of taxation. If, on the other hand, you can enter many kilometers per year in your tax return, you have an advantage with the 25 percent option.

VLH tip: If you want to be on the safe side, you should seek tax advice in advance – for example from a VLH advisor.

The VLH: largest wage tax aid association in Germany

The Lohnsteuerhilfeverein Vereinigte Lohnsteuerhilfe e. V. (VLH) is Germany’s largest wage tax aid association with more than a million members and around 3,000 advice centers nationwide. Founded in 1972, the VLH also provides most of the DIN 77700 certified consultants.

The VLH prepares the income tax return for its members, applies for allowances, determines and applies for subsidies and allowances, checks the tax assessment and a lot more within the scope of the legal advisory authority according to § 4 No. 11 StBerG.

Press contact:

Christina Georgiadis
United wage tax assistance e. V. (VLH)
Fritz-Voigt-Str. 13
67433 Neustadt ad Weinstrasse

Tel.: 06321 4901-0
Fax: 06321 4901-49

Email: [email protected]
Web: www.vlh.de/presse

Original content from: Vereinigte Lohnsteuerhilfe eV – VLH, transmitted by news aktuell


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