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Posted 17 Mar 2020

Reading time: 6 Minutes

More and more companies are using employee benefits to save taxes. But employee benefits do more than just result in tax savings. They are a wonderful opportunity for employers to do something good for their employees. In 2020, too, there will be numerous tax-saving models that companies can use to kill two birds with one stone. The most important change in terms of employee offers is the expansion of the tax incentives for electromobility from the state. For example, since January 1 this year, companies have been given the option of a special depreciation of up to 50 percent on the purchase price of an electric delivery vehicle. The Federal Government also announced an extension of the tax breaks for e-company cars for 2020. We will lay out the details about that in the following paragraphs as well as take a look at other tax savings models for companies in 2020.

How can a company save taxes in 2020?

There are various options that small, medium-sized and large companies can use to save taxes in 2020. For example, while small and medium-sized companies can offer their employees discounts for local public transport or the local fitness studio, larger companies are increasingly making use of the opportunities in the area of ​​electromobility. Current government funding offers are higher than ever, which benefits both employees and employers. In addition to the tax-privileged purchase of e-cars and e-vans, there were also changes to the law regarding trade tax for such vehicles. If employees are allowed to use an electric or hybrid company car privately, only half of it has to be taxed. The annual tax law, which originally only applied to purchases up to the end of 2021, has only been expanded and has been applicable to all e-company cars that have been purchased up to and including December 31, 2030 since 2020.

Further tax breaks for companies in 2020

In 2020, the employer may also use the expenses for his employees for his tax benefit by taking over 25 percent of the taxes on trips between the home and the first place of work. This only applies if the employee uses public transport on the regular service for the route. This flat-rate taxation for job tickets offers an excellent option for corporate benefits, especially for employers in larger cities with good transport connections. The same applies to the extension of the law regarding further training. While the state previously imposed additional wage tax payments as soon as an employee took part in further training that went beyond job-related further training, the following applies now: any further training measure that serves to improve the employability of an employee is without exception tax-free.

Why are tax savings models so popular in 2020?

The reasons for this are obvious: It is very difficult to get good specialist staff these days. In order to position yourself as an attractive employer on the market, good employer branding is required, i.e. a strong employer brand. Nowadays it is often no longer enough to pay future employees an appropriate salary. Rather, it is often the small but visible differences that interested professionals make their selections from. Corporate benefits therefore definitely offer an attractive opportunity to score with additional offers for employees. Such employee benefits ultimately represent cheap tax-saving models for your own company, while the company's employees can look forward to extras. These extras include food coupons and employee discounts, but also e-scooters or e-bikes for employees and the provision of an individual training or mobility budget.

The large number of options will enable companies of all sizes to benefit from tax-saving models in the future. So far, the tax breaks have been of interest to larger companies that want to convert their fleets to electromobility, for example, or to offer their employees discounted meals in the company's canteen. With the expansion of many laws and the increasing range of options for corporate benefits, more and more smaller companies are now finding what they are looking for when it comes to choosing tax-saving mod

What if buying an electric vehicle is not an option?

Of course, small and medium-sized companies do not buy rows of electric vehicles just because their purchase will be tax-deductible in the future. Either a company already has company cars that can still be used due to their perfect functionality. Or the purchase of a company car is irrelevant because the car could not be used effectively enough. In both cases, a so-called mobility budget is an interesting alternative. With the help of a fixed monthly budget, the employee can cover the distance between his home and his place of work using various means of transportation - instead of having his own company car. This option offers numerous advantages, particularly when it comes to taxation. In addition to public transport, the use of sharing and leasing offers for e-scooters and pedelecs for companies are also suitable. With special discount campaigns, companies can save additional money while remaining flexible when it comes to the use of individual vehicles.

Do you have any questions about e-mobility or are you still unsure to what extent your company will be able to use tax-saving models in 2020? Then please contact us with no obligation. We would be happy to advise you and explain how you can save a lot of taxes with your company in 2020.