How are overtime taxed?

State overtime on your tax return

overtime should be stated explicitly in the tax return, because they are taxed comparatively high if they are not taken into account here and are taxed as part of the regular salary that is not specially marked.

Although they usually mean a higher and additional salary for employees, the payment of overtime before the law and especially before the tax office is considered a normal salary.

Overtime is taxed heavily

Both the employee and the employer can suffer a disadvantage when receiving the pay slip.

Because as soon as he simply adds the overtime to the normal salary, he has to pay all social expenses, as with the normal salary. Correspondingly less net salary is paid to the employee.

To avoid this, there is the option of a so-called Lifetime working time account to be set up by the respective employer.

However, the payments that are intended for the pension later should primarily be made on this account. If overtime is incurred, you can still have it paid into this account.

Keep the tax burden as low as possible

At best, you don't let that much extra work accrue in the first place. However, if this cannot be averted temporarily, it is advisable to compensate for it with free time, as usually not much remains after deducting taxes and social security contributions.

If it is not possible to compensate for time off, it is also advisable not to have all of the overtime paid off at once. The less overtime pay is added to the normal salary, the less should the tax burden and social security contributions (which are, however, paid by the employer). Therefore, the information can be helpful in the tax return.

Should you decide to have all overtime paid out at the same time, you can, as already described, get a large part of this back when you submit your tax return.

It is important to create documentation for yourself - and ideally also for the employer - about the overtime accrued and how it is billed. This makes it easier and easier to provide this information in the tax return.

Individual evidence


  1. Internal laws: Working Hours Act (ArbZG) →
  2. Laws on the Internet: Working Hours Act § 3 Working Hours of Employees →

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