Employee Savings Allowance: Who Qualifies and What You Get
Learn how the Employee Savings Allowance provides a state bonus on your capital-forming benefits to help boost your long-term savings.
The Employee Savings Allowance is a government bonus designed to supplement the money your employer contributes to your long-term savings.
Who it's for
This scheme is available to employees whose taxable income falls below a certain annual limit. This specific income threshold applies to single individuals.
What you get
You receive a state bonus on your capital-forming benefits. This extra money is added to your savings to help increase the total amount of capital you build over time.
What it costs you
There is no direct fee to apply for this benefit. However, to access it, you must have a savings contract in place through your employer.
The catch to know
This benefit is often overlooked because it is not always automatically applied to your account. You should carefully check your employment contract to see if it includes "Vermögenswirksame Leistungen" (capital-forming benefits) to ensure you are eligible to participate.
How to apply
- Review your employment contract to see if it includes provisions for capital-forming benefits.
- Set up a qualifying savings contract through your employer.
- Check with your employer or your tax office to ensure the state bonus is being applied to your savings.