Job tickets are popular employee benefits offered by companies. They provide their employees with a ticket for local public transport and thus relieve them of ongoing costs. If a job ticket is provided, however, companies must observe the tax regulations on this.
What is a job ticket?
Originally, job tickets were monthly or annual tickets for public transport that a company bought from a transport company and provided to its employees in addition to their wages. With the job ticket, employees can travel to work every day, but they may also use the ticket for private journeys.
Large companies in particular can obtain attractive discounts by purchasing large contingents of job tickets from public transport companies.
By providing job tickets, the employer provides Non-cash benefits, which must also be taxed as part of the salary and for which social security contributions are due. However, journeys by public transport between the home and the first place of work are tax-free if the job ticket is provided in addition to the remuneration owed.
As Non-cash benefits, the subsidy for a job ticket must be used in relation to the item.
Legal basis for the job ticket
Since January 2019, the employer allowance for the use of public transport is tax-exempt. Section 3 paragraph 15 of the Income Tax Act (EStG) applies. Accordingly, the tax exemption only applies to journeys between the first workplace and the employee's home. It is also important that the allowance is paid in addition to wages. This regulation also covers the provision of the job ticket, which is either provided free of charge or at a reduced rate by the employer. It does not matter whether the job ticket is used exclusively for work-related journeys or also privately.
An example: Employers can provide their employees with a Bahncard 100 tax-free and employees can also use it privately. The prerequisite here is that the purchase of individual tickets for the daily train journey to work and back home would be more expensive than the Bahncard.
The job ticket as salary conversion
The employer can offer the expenses for the job ticket or subsidies for the use of public transport in the form of salary conversion. The allowances are converted into gross salary and are part of the monthly remuneration.
As part of the gross salary, the salary conversion must be taxed. The legislator provides for a per diem wage tax of 15 or 25 per cent. The legal basis is provided by the Income Tax Act with paragraph 40. The amount of taxation depends on whether the job ticket is offset against the employee's commuting allowance. The employer can choose between:
- Per diem taxation of the job ticket converted into salary at 15 per cent: In this case, the salary conversion is entered in the annual income tax certificate and it is offset against the commuting allowance.
- Per diem taxation of the job ticket converted into salary at 25 per cent: In this case, the salary conversion for the job ticket is not entered in the annual income tax certificate. In this case, it is not possible to offset it against the flat-rate travel allowance.
Important: If the salary conversion is used, companies can continue to use the monthly tax exemption limit of 50 euros for the noncash benefits.
Disadvantages of the job ticket
The job ticket offers employees an additional benefit to their salary or can be part of their salary with tax benefits.
However, job tickets do not offer much of an advantage, especially with flexible working hours. Employees working from home or on the road would have to apply for a separate job ticket for each location. This would require a great deal of administrative effort for everyone involved.
A sensible alternative is the mobility budget, which can be released by companies for all means of transport, regardless of location. Employees and employees benefit from this in terms of taxation. With Circula, mobility budgets can be easily managed and approved via the app.