Many companies pay capital formation benefits – i.e. a subsidy to their employees’ savings plans. Then there is the state employee savings allowance: since January it has been applicable to significantly higher incomes than before.
By Johanna Stein
New year, new rules: At the turn of the year, the government improved the employee savings allowance. The government financial injection is intended to help employees build wealth. Employees who receive so-called “capital-forming benefits” from their company can apply for them. Because the government wants to offer a savings incentive, especially to low-income earners, the regulation only applied to a few employees until the end of 2023.
The income limits were a taxable gross income of 17,900 euros for single people and 35,800 euros for registered life partners and married people. In January of this year, however, the limit was raised significantly: to 40,000 euros for individuals and 80,000 euros for life partners and married people. Around 17 million employees could benefit additionally from the new regulation.
Capital-forming benefits are a subsidy that many employers voluntarily pay to employees’ wages to help them save. The money flows directly into savings plans: either into building savings plans and building loans – this is called “housing use” – or into asset investments such as fund savings plans.
Employees, trainees, civil servants, judges or soldiers receive capital-forming benefits directly from their employer or employer. You can find out whether you are entitled to this from your employer or works council – this is stated in the collective agreement, the works agreement or the employment contract. Sometimes it’s also worth simply asking your employer. Contrary to what is often assumed, there is no upper limit for companies’ voluntary contributions. On average, companies pay between 6 and 40 euros per month.
Pay attention to deadlines!
Employees conclude contracts for capital-forming services with a provider of their choice. They will then receive a form to present to their employer for signature. However, anyone who receives the savings allowance is bound to certain deadlines. Contracts for capital-forming services generally run for a period of seven years.
For building savings contracts, this means you have to save for seven years. Only then can employees take advantage of the loan or have the credit paid out. The following applies to most other savings plans: money is paid in for six years and the seventh year is the so-called rest period. You can only use the money freely after the seventh year. However, this does not mean that employees have to forego payments from their employer after the sixth year – after the sixth year they can immediately conclude a new contract. As a rule, the employer gives timely notice as soon as a contract expires and offers the employees a new contract.
After the contract period has expired, employees can freely use the money saved from the contracts for capital-forming benefits. In contrast to company pension schemes, you do not have to pay taxes or social security contributions. And anyone who receives capital-forming benefits without the government subsidy can cancel their portfolio at any time anyway.
The taxable income is crucial
The state subsidizes asset accumulation as follows: The subsidy rate for building savings or building loans is currently nine percent, the maximum allowance is 43 euros per year. For the investment of capital-forming benefits in shares, for example ETF funds, the employee savings allowance is 20 percent of the savings amount per year, and a maximum of 80 euros. Anyone who receives both subsidies because they save on two contracts with capital-forming benefits will receive a maximum of 123 euros. What many employees don’t know: If the employer’s voluntary contributions are not sufficient to provide full support, it is usually worth topping up the missing amount with part of the net salary. You can therefore ensure that the full funding amount is paid out of your own pocket.
Important: It is not your gross income that determines whether you receive the employee savings allowance, but rather your taxable income. This is significantly lower, especially for families with children, due to the tax allowances. The allowance per child for a couple filing jointly is now 9,312 euros. Anyone whose gross salary is above the income limit should still check whether they can receive the funding. The exact amount of taxable income is stated in the last tax assessment.
This article appeared firstwhich, like stern, is part of RTL Deutschland.
Source: Stern
