Your November payslip shows a nice extra: the Christmas bonus (Weihnachtsgeld). What reaches your bank account is much less, often only a little over half. Many people think a Christmas bonus is taxed at a special high rate. That is not quite true. It is calculated differently from your regular salary, but in the end it is not taxed more heavily.
In short: with 3,500 € gross a month, tax class I, no children and no church tax, a Christmas bonus of 1,750 € leaves 961.37 € net, i.e. 54.9 %.
This article shows how German employers calculate the income tax on a Christmas bonus, which social contributions apply, when the contribution ceiling helps and what difference your tax class makes. All values apply to 2026. As of October 2026. Use the Christmas bonus calculator to check your own case.
What a Christmas bonus is for tax purposes
German wage tax law distinguishes between regular pay (laufender Arbeitslohn) and non-recurring payments (sonstige Bezüge). Regular pay is what you get every month: salary, fixed allowances, overtime pay. Non-recurring payments are everything else. The wage tax guidelines explicitly list Christmas bonuses, 13th and 14th month salaries, holiday pay and profit-related bonuses (R 39b.2 (2) LStR).
Non-recurring payments are taxed in the year in which they are paid (§ 38a (1) sentence 3 EStG). A Christmas bonus paid with the November salary therefore belongs to 2026, even if your contract calls it a "13th salary".
How your employer calculates the income tax
If the employer simply added the bonus to the November salary and treated it like ordinary monthly pay, the tax would be far too high: the monthly tax table assumes you earn that amount twelve times a year. § 39b (3) EStG therefore prescribes a separate procedure, the annual tax method:
- The employer estimates your expected annual wage without the bonus. It includes your regular salary for all twelve months and any non-recurring payments you have already received this year, such as holiday pay.
- He calculates the annual income tax on this amount.
- He then calculates the annual income tax on the annual wage plus the bonus.
- The difference is the income tax on the Christmas bonus.
J is the annual wage without the bonus and W the bonus. Both annual tax amounts include the allowances built into the wage tax table (employee allowance 1,230 €, special expenses allowance 36 €) and the flat-rate deduction for your social insurance contributions (Vorsorgepauschale).
Worked example
Monthly gross 3,500 €, Christmas bonus 1,750 € (half a month's salary), tax class I, no children, no church tax, additional health insurance rate 2.9 %:
| Step | Amount |
|---|---|
| Annual wage without bonus (12 × 3,500 €) | 42,000.00 € |
| Annual income tax on it | 4,866.00 € |
| Annual wage with bonus | 43,750.00 € |
| Annual income tax on it | 5,274.00 € |
| Income tax on the bonus | 408.00 € |
So 408 € income tax is due on the 1,750 €, that is 23.3 %. On your regular salary you pay only 11.6 % on average (4,866 € of 42,000 €). The difference is not a surcharge. The bonus simply sits "on top" of your income and is taxed at your marginal rate, the rate for each additional euro. Had the employer spread the 1,750 € over twelve months, the annual tax would be exactly the same.
Solidarity surcharge and church tax
Since 2021 only people with high incomes pay the solidarity surcharge. In 2026 it does not apply as long as the annual income tax is not above 20,350 €, or 40,700 € in tax class III (§ 3 (3) SolZG). For single people in tax class I that covers annual gross pay up to a little over 90,000 €.
There is one special rule for bonuses: if the annual tax including the bonus is above the exemption limit, the employer withholds a full 5.5 % surcharge on the tax on the bonus. The phase-in zone that softens the transition for regular pay is not applied to non-recurring payments in payroll, according to the Federal Ministry of Finance's 2026 wage tax flowchart. Any surcharge paid in excess is refunded via your tax return.
Church tax is 8 % of the income tax in Bavaria and Baden-Württemberg and 9 % elsewhere. It is based on the income tax on the bonus. In the example it would be 36.72 € in North Rhine-Westphalia.
Social contributions on the bonus
A Christmas bonus is a one-off payment of earnings and is generally subject to contributions (§ 23a SGB IV). As an employee you pay these shares in 2026:
- Health insurance: 7.3 % plus half of your insurer's additional rate; with the average additional rate of 2.9 % that is 8.75 %
- Long-term care insurance: 1.8 %, in Saxony 2.3 %; childless people aged 23 and over pay 0.6 points more, parents of two or more children under 25 pay less
- Pension insurance: 9.3 %
- Unemployment insurance: 1.3 %
In the example that is 153.13 € health insurance, 42.00 € care insurance (childless), 162.75 € pension insurance and 22.75 € unemployment insurance, 380.63 € in total. Together with the income tax of 408 €, 961.37 € net remains.
The contribution ceiling can help
Contributions are only charged up to the contribution ceiling (Beitragsbemessungsgrenze). In 2026 it is 69,750 € a year (5,812.50 € a month) in health and care insurance and 101,400 € (8,450 € a month) in pension and unemployment insurance.
For one-off payments the pro rata annual ceiling counts: the monthly ceiling times the number of months from January to the month of payment, minus the pay that was already subject to contributions in that period (§ 23a (3) SGB IV). Only the part of the bonus that fits into this remaining room is subject to contributions.
Example: you earn 6,000 € a month and receive a 3,000 € bonus in November. Your salary is already above the monthly health insurance ceiling, so there is no room left. No health or care insurance contributions are due on the bonus, only pension and unemployment insurance (318 €). In tax class I, 1,652 € net remains of the 3,000 €.
If you are just below the ceiling, you benefit partly. If the bonus is paid in December, the remaining room is one month larger. For most employees, however, the month makes no difference.
The so-called March clause only affects one-off payments from January to March and is not relevant for a Christmas bonus.
Midijob
If your pay is in the transition zone between 603.01 € and 2,000 € a month (§ 20 (2) SGB IV), you pay reduced employee contributions. If your monthly pay including the bonus stays below 2,000 €, the reduced formula also applies to the month of payment. If it goes above, full contributions are due for that month. The midijob calculator has the details.
How much you keep at different salaries
The higher your regular salary, the higher your marginal tax rate and the less you keep of the bonus. Above the health insurance ceiling this briefly reverses because contributions drop out. The table shows a 1,000 € bonus in tax class I without children or church tax, paid in November:
| Monthly gross | Income tax | Social contributions | Net |
|---|---|---|---|
| 2,000 € | 193.00 € | 217.50 € | 589.50 € |
| 2,500 € | 206.00 € | 217.50 € | 576.50 € |
| 3,000 € | 219.00 € | 217.50 € | 563.50 € |
| 4,000 € | 246.00 € | 217.50 € | 536.50 € |
| 5,000 € | 272.00 € | 217.50 € | 510.50 € |
| 6,000 € | 341.00 € | 106.00 € | 553.00 € |
| 8,000 € | 381.00 € + 20.95 € surcharge | 106.00 € | 492.05 € |
Your tax class matters a lot
Social contributions are the same in every tax class. The income tax varies a lot. For a 1,750 € bonus with 3,500 € monthly gross and no children:
| Tax class | Income tax | Net |
|---|---|---|
| I and IV | 408.00 € | 961.37 € |
| II | 387.00 € | 982.37 € |
| III | 302.00 € | 1,067.37 € |
| V | 568.00 € | 801.37 € |
| VI | 578.00 € | 791.37 € |
This is only the amount withheld. Married couples with III/V are assessed jointly anyway, and the difference evens out there. Why a quick change of tax class before the bonus rarely helps is explained in Christmas bonus and tax class.
Do you get tax back?
The annual tax method gets the correct annual tax fairly right. A refund via the tax return is still common, for example if your work expenses exceed 1,230 €, you were not employed all year, a full 5.5 % surcharge was withheld although your income is in the phase-in zone, or you are married and assessed jointly. The tax refund calculator estimates your refund.
Keeping more of your bonus
There are hardly any tax-free tricks for a Christmas bonus. The inflation compensation bonus, which could be paid tax- and contribution-free until the end of 2024, no longer exists. Two legal routes remain:
- Deferred compensation: part of the bonus is paid into a company pension scheme. In 2026 up to 8 % of the pension insurance ceiling is tax-free (8,112 €, § 3 No. 63 EStG) and up to 4 % contribution-free (4,056 €). The later company pension is taxed and subject to contributions instead.
- Claiming work expenses: commuting costs, work equipment or training above the standard allowance lower your annual tax. The money comes back via the tax return.
Are you entitled at all?
No German statute requires a Christmas bonus. A claim only arises from your employment contract, a collective agreement, a works agreement, company practice or equal treatment. Details, including part-time work, parental leave and resignation, are in Is there a right to a Christmas bonus?. Whether you must pay it back if you resign early next year is covered in Paying back a Christmas bonus.
In the public sector the Christmas bonus is called the annual special payment. The 2026 rates are in Annual bonus in the German public sector.
Other rules
- Garnishment: a Christmas bonus is exempt up to 795 € (§ 850a No. 4 ZPO, value from 1 July 2026). The rest counts as garnishable income. See the wage garnishment calculator.
- Parental allowance: non-recurring payments are disregarded when parental allowance is calculated (§ 2c (1) sentence 2 BEEG). A Christmas bonus does not increase it.
- One-fifth rule: it only applies to compensation payments and pay for work over several years, not to a Christmas bonus.
Conclusion
Depending on salary and tax class, you usually keep 45 to 65 % of a Christmas bonus. The high deduction rate is not due to a special tax but to the marginal tax rate and full social contributions. Only employees above the contribution ceiling pay noticeably less. Calculate your exact amount with the Christmas bonus calculator.
Sources: § 39b (3) EStG, § 38a (1) EStG, R 39b.2 LStR, official wage tax flowchart 2026 (Federal Ministry of Finance letter of 12 Nov 2025), § 23a SGB IV, § 20 SGB IV, §§ 3, 4 SolZG, § 3 No. 63 EStG, § 850a ZPO, § 2c BEEG; all statutes on gesetze-im-internet.de. As of October 2026.