Holiday allowance — can it be taxed at the flat 25 % rate?
Up to EUR 156 for the employee, EUR 104 for the spouse and EUR 52 per child in a calendar year, the employer may tax the allowance at a flat 25 % — provided it makes sure the money is spent on recreation. One euro too many and the whole allowance is taxed at the employee's own rate.
2026 rules — verified on September 23, 2026Free, no account
Your result
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Sources and assumptions
- gesetze-im-internet.de — EStG § 40 Abs. 2 Satz 1 (Einleitung) — tax year 2026, verified on September 23, 2026
Excerpt from the source : « Abweichend von Absatz 1 kann der Arbeitgeber die Lohnsteuer mit einem Pauschsteuersatz von 25 Prozent erheben »
- gesetze-im-internet.de — EStG § 40 Abs. 2 Satz 1 Nr. 3 — tax year 2026, verified on September 23, 2026
Excerpt from the source : « 156 Euro für den Arbeitnehmer, 104 Euro für dessen Ehegatten und 52 Euro für jedes Kind nicht übersteigen »
- gesetze-im-internet.de — EStG § 40 Abs. 2 Satz 1 Nr. 3 — tax year 2026, verified on September 23, 2026
Excerpt from the source : « 104 Euro für dessen Ehegatten »
- gesetze-im-internet.de — EStG § 40 Abs. 2 Satz 1 Nr. 3 — tax year 2026, verified on September 23, 2026
Excerpt from the source : « 52 Euro für jedes Kind nicht übersteigen »
Calculation assumptions
- Solidarity surcharge and church tax on the flat-rate wage tax are not calculated.
- Children means children recognised for tax purposes; the three amounts are added into a single annual limit.
- The social security exemption requires the flat-rate taxation to be applied in the payroll of the period concerned (s. 1(1) sentence 2 SvEV).
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This result is provided for information purposes only and does not constitute personalised tax advice. Check your situation with the tax authorities or a professional.