Once a specification is missing, the loan is deemed to be interest-free and must therefore be fully taxed. Corporate Loans Non-Interesting | Loan agreements | Template. Employer loan termination attorney can help you in you are on the safe side.
If the principal lends a loan to his employee, a monetary advantage usually results if the loan is granted without interest or at a reduced interest rate. It should first be pointed out that there is no taxation as a wage if the amount of loans not yet repaid at the end of the salary payment does not exceed 2 600 euros. For the determination of the debt advantage, two valuation methods are to be distinguished: the general taxation of benefits in kind (§ 8 Abs. 2 EStG):
Special taxation of benefits in kind (8 para. 3 EStG): These are basically “personnel discounts”, ie the employee gets goods for free or at a reduced price, with which the entrepreneur buys. In the case of granted loans, this applies in particular to employees of credit institutions.
The general taxation of benefits in kind will be examined in more detail below. The applicable at the place of delivery to the usual discounts reduced final price. The usual closing price is the market interest rate (reference interest rate), reduced by a flat deduction of 4%. In the case of fixed-rate employer loans, the reference interest rate is usually valid for the entire duration of the contract.
In the case of a variable interest rate, the new agreed interest is compared with the current reference interest rate in order to determine the interest rate advantage at the time of the contractual interest rate adjustment. The usual closing price is (alternatively) also the cheaper value for a reference loan with demonstrably favorable market conditions, in which the loan is offered to the end consumers, including universal internet offers – without consideration of individual price calculations for the conclusion of the contract.
The documents underlying the income tax for the determined closing price as well as the calculation of the interest payments are to be proven by the client, kept as receipts for the salary account and inform the employee informally if desired. The taxation of the monetary advantage can usually be carried out by the client at a flat rate. However, if the employer has already considered the most advantageous tariff, the employee may have an even lower tariff in the income tax assessment.