Side Income Tax Calculator

It depends on the type of side income and your main income. A Minijob up to EUR 520/month is completely tax-free for you. For all other side income, the profit is taxed at your personal marginal tax rate, which typically ranges from 14% to 42%. The higher your main salary, the higher the tax rate on your side income.

Yes, for you as an employee, a Minijob up to EUR 520/month is completely free of taxes and social contributions. The employer pays flat-rate charges of about 30% (flat tax, pension insurance, health insurance, levies). However, you can voluntarily contribute to pension insurance to earn full pension entitlements.

A tax return is mandatory once your side income (excluding Minijobs) exceeds EUR 410 per year. For self-employed or rental income, filing is always required. With a second employment under tax class VI, filing almost always pays off since you frequently get back overpaid wage tax.

The EUR 520 limit is the maximum monthly earnings for marginal employment (Minijob), equaling EUR 6,240 per year. If this limit is regularly exceeded, the employment automatically becomes subject to full social insurance. Occasional overages (maximum 2 months per year, e.g., due to covering for colleagues) are permitted.

The small business threshold is EUR 22,000 in annual revenue. If you exceed it, you must charge VAT (19% or 7%) on your invoices starting the following year and submit regular VAT advance returns. The upside: you can then also deduct input VAT from your purchases and business expenses, which reduces the net burden.

Under employment law, you are generally required to inform your employer about a side activity, especially if your employment contract includes an approval clause. Your employer may only prohibit a side job if legitimate interests are affected (e.g., competition, working time regulations). A blanket prohibition of side activities is legally invalid.

A Minijob up to EUR 520/month is the most tax-efficient option since no deductions apply. For higher earnings, freelance activity is often more advantageous than employment because no social contributions are due and business expenses can be deducted directly. Use our comparison calculator to find the optimal option for your situation.

Rental income is taxed at your personal income tax rate as income from renting and leasing. However, you can deduct numerous expenses: loan interest, depreciation (typically 2% per year), maintenance costs, management fees, and property tax. Social contributions do not apply to rental income.

A trade license is only required for commercial activities (e.g., online retail, crafts, hospitality). Freelance activities such as writing, design, consulting, teaching, or art do not require a trade license. When in doubt, section 18 of the Income Tax Act (EStG) defines the liberal professions. Trade registration at the local trade office costs between EUR 20 and EUR 60.

The marginal tax rate indicates how much tax applies to the next euro earned. It results from the progressive income tax formula (section 32a EStG) and rises from 14% (above the basic allowance) to 42% (above approximately EUR 68,480 taxable income). The top rate of 45% applies above EUR 277,826. Our calculator automatically determines your exact marginal tax rate.