Tax-Free Employee Gifts in Germany: the 2026 Rules Explained

A thank-you to the team should bring a smile, not a headache for payroll. If you want to give tax-free employee gifts in Germany, there are three limits to know: benefits in kind up to 50 euros a month, tokens up to 60 euros for a personal occasion and the allowance for the Christmas party. Here are the 2026 rules in plain words, plus gift ideas for employees under €50.

Tax-free employee gifts in 2026: the rules at a glance

• Benefits in kind up to 50 euros a month: gifts in kind without a special occasion, Christmas included.
• Tokens of appreciation up to 60 euros: only for a personal occasion such as a birthday or wedding.
• Christmas party up to 110 euros: an allowance per person and company event, gifts handed out at the party count towards it.
• Above that: the employer can pay the tax at a flat rate of 30 %.
• Cash: is never tax-free, not even a small amount.

The 50-euro benefit in kind: the limit for Christmas and the rest of the year

Under section 8(2) sentence 11 of the German Income Tax Act (EStG), benefits in kind stay free of tax, and usually of social security contributions, as long as together they do not exceed 50 euros in a calendar month. This is an exemption limit, not an allowance: if the value goes even slightly over, the whole amount becomes taxable. All benefits in kind in the month add up, including a prepaid benefits card. Vouchers only count as benefits in kind if they are given on top of the salary already owed.

Christmas or birthday: 60 euros only for a personal occasion

On top of that there are tokens of appreciation under R 19.6 of the German wage tax guidelines. Gifts in kind up to 60 euros including VAT are tax-free if they are given for a special personal occasion. Typical examples are a birthday, a wedding, the birth of a child, a milestone work anniversary or a passed final exam.

Christmas is not a personal occasion. It applies to everyone at the same time, so the 60-euro limit does not cover it. Christmas gifts fall under the 50-euro benefit in kind or the Christmas party.

Gifts at the Christmas party: 110-euro allowance

For company events, section 19(1) sentence 1 no. 1a EStG provides an allowance of 110 euros per attending person and event, for up to two events a year. The event must be open to everyone in the company or in a department. All costs including VAT are counted: food, drinks, venue and entertainment.

Gifts handed out at the party count towards these 110 euros. According to the tax authorities, this works for gifts up to 60 euros, as long as the event is more than just handing out presents.

If you want to give more: the 30 % flat-rate tax

If a gift is above the limits, the employer can take over the tax at a flat rate of 30 % under section 37b EStG, plus solidarity surcharge and church tax where applicable.

This is not tax advice. Please check your situation with your tax adviser.

Gifts for employees under €50: ideas that get used

• Something to use up: coffee from a nearby roaster, honey from a local beekeeper, good olive oil.
• Everyday helpers: a water bottle that does not leak, a sturdy umbrella, a lunchbox for the office.
• Something for the bathroom or kitchen that is used every day. This is where the Soapi comes in.

The Soapi as an employee gift

The Soapi is a magnetic soap holder. You press a bottle cap halfway into a bar of soap, the soap hangs from the magnet on the wall and dries all the way round instead of going soft in a dish. The basin stays clean. It sticks to tiles, glass or stainless steel without drilling and comes with a 10-year durability guarantee. A Soapi costs €12.95, the Starter Kit with a lavender soap handmade in Marseille and a cleaned bottle cap costs €14.95. A Soapi is well below the 50-euro limit.

Everyone has a basin, and the parcel is small and easy to post. The Soapi is injection-moulded in Berlin. The housing is injection-moulded from recycled plastic, around 90 % of which comes from discarded fishing nets and ropes. More than 250 retailers worldwide stock Soapi, and Soapi is listed in the PSI Product Finder.

With your logo, the gift is seen every day: we print bottle caps with your company logo from 500 pieces. The number of Soapis is independent of that, for example 40 Soapis for the team, with the remaining logo caps becoming a small giveaway at reception. The 10 colours can be mixed or matched to your brand colour. As a company, you buy from us at the retailer price: very good terms that normally only go to retailers who order from us regularly. Printing logo caps takes about two weeks from order to dispatch, often much less. Send your corporate gift enquiry here. With logo caps, it is better to ask early so there is enough time for printing.

Small team, no logo: Mix & Match

For five or ten people you do not need an enquiry. With Mix & Match you choose 5 products, pay €50 and get free delivery within Germany. You can combine Soapis in all 10 colours, the magnetic key holder and solid soaps, such as soap from Marseille or soaps by Blaull, Grete Manufaktur and KLAR.

FAQ

Is a Christmas gift for employees up to 60 euros tax-free?

No. The 60 euros only apply to personal occasions such as a birthday or wedding. At Christmas, the 50-euro monthly limit for benefits in kind or the Christmas party allowance applies.

What about clients and business partners?

Different rules apply there, including a separate 50-euro limit per year. Read more in our article on client gifts and gifts for business partners.

This is not tax advice. Please check your situation with your tax adviser.

In short

For tax-free employee gifts in Germany, three numbers usually do the job: 50 euros a month, 60 euros for a personal occasion, 110 euros at the party. More festive ideas are in Christmas gifts for employees and clients. For a gift with your logo, send us an enquiry; for a small team, put together five items with Mix & Match.