Table of Contents
- Changes for the new year in HR – what's new in 2026?
- Private health insurance: Digital reporting will replace paper certificates from 2026
- Contribution rates for the Insolvency Insurance Pension Security Association
- Interest rate declarations within the insurance industry
- Introduction of the active pension
- Annual EPF General Meeting in November 2025
Changes for the new year in HR – what's new in 2026?
As of January 2026, there will be several changes that HR departments, including employee administration and payroll, will need to take into account. Here is a list of the most significant changes:
Minimum wage
As of January 1 2026, the minimum wage will increase by 8.42% from 12.82 € to 13.90 € per hour. Although the minimum wage does not apply to apprentices, there has been an increase in the minimum remuneration for apprentices. From the new year, this is set at a minimum of 724 € per month for the first year of an apprenticeship.
Child benefit / child supplement
On January 1, 2026, the non-means-tested child benefit will increase from 255 € to 259 € per month for each child. The adjustment will be made automatically without parents having to take any action.
The maximum monthly child supplement will remain fixed at 297 € per month per child. The child allowance is a state subsidy supporting lower-income families. An application must be submitted to receive the subsidy.
New non-cash remuneration values
The 16th amendment to the Social Security Remuneration Ordinance is currently underway. Once the procedure has been concluded, the non-cash remuneration values for 2026 will be changed. The value for free meals will increase to 345 € per month, and for free accommodation to 285 € per month. The details of the planned non-cash remuneration values are as follows:
| Non-cash benefits | ||
|---|---|---|
| per calendar day | monthly | |
| Breakfast | 2.37 € | 71.10 € |
| Lunch or dinner | 4.57 € | 137.10 € |
| Accommodation and rent | 9.50 € | 285.00 € |
Together with the tax-free subsidy of 3.10 €, as of January 1, 2026 employers can reimburse their employees with a meal allowance of 7.67 € per working day as a benefit.
Deutschland-Ticket as job ticket
Effective January 1, 2026, the Deutschland-Ticket will cost 63 € per month, an increase of 5 €. Accordingly, the list price for employers providing subsidies will also rise to a maximum of 59.85 € where costs are fully covered. The price increase and continuation of the subscription were subject to approval by the subscriber (the end user) by 30th November 2025 if the employer does not cover the full cost of the Deutschland-Ticket, i.e. if the end user is still required to pay a proportion of the cost. If the employer pays 100% of the cost of the job ticket, then no consent from the end user was required.
Distance-based travel allowance
Commuters are due to receive greater financial relief. From January 1, 2026, the distance-based-travel allowance will rise permanently to 0.38 € as of the first kilometer. In addition, taxpayers with low incomes will continue to receive a mobility allowance after 2025. The relief measures will apply to everyone, regardless of their chosen means of transport.
Marginal income threshold, contribution assessment ceiling, annual income limit, additional contribution health insurance contribution
From January 1, 2026, the marginal income threshold will be 603 € per month. Up to this limit, mini-jobs are subject to flat-rate taxation and are exempt from social security contributions. For jobs subject to social security contributions, the contribution assessment ceiling for health and long-term care insurance will rise to 5,812.50 € per month / 69,750.00 € per year. The contribution assessment ceiling for pension and unemployment insurance will increase to 8,450.00 € per month / 101,400.00 € per year. The general annual income limit (JAEG) stands at 77,400 €. Above this threshold, statutory health insurance is no longer compulsory, and employees are free to choose between statutory health insurance (GKV) and private health insurance (PKV). These limits apply across all federal states. Contribution rates for health and long-term care insurance remain stable. The Federal Ministry of Health has set the average additional contribution rate for statutory health insurance at 2.9%. As a rule, the health insurance funds determine their individual additional contribution rates by the end of December. The general contribution rate for statutory health insurance remains the same at 14.6%. In other pillars of social insurance, there have been no adjustments to contribution rates.
Private health insurance: Digital reporting will replace paper certificates from 2026
As of January 1, 2026, the previous requirement to provide proof of contributions to private health and nursing care insurance in the form of paper certificates will no longer apply. Instead, private health insurers will transmit the relevant contribution data once a year to the Federal Central Tax Office, who will then make it available to employers via ELStAM.
In future, two new electronic income tax deduction features will be made available for this purpose. One reflects the tax-free employer subsidy, while the other indicates the portion of the contribution that is considered for tax purposes when calculating the pension allowance.
For HR and payroll managers, this change will lead to a significant reduction in manual processes. At the same time, the requirements for correct data transmission and the timely retrieval of ELStAM information will become more stringent.
Companies should therefore carefully review and adapt their payroll processes and interfacing systems by the turn of the year 2025/2026. Furthermore, it is advisable that they inform employees with private health insurance about the changes at an early stage, particularly the existing right to object and the possible tax implications.
Contribution rates for the Insolvency Insurance Pension Security Association
The Pension Security Association (PSVaG) has set the contribution rate for 2025 at 1.2 per thousand. Although this is a significant increase compared to the previous year’s contribution rate of 0.4 per thousand due to the rise in the number of corporate insolvencies, it is nevertheless still below the long-term average of approximately 2.4 per thousand. The fact that the contribution rate has only risen to 1.2 per thousand, even though the number of corporate insolvencies reached its highest level in more than 10 years at 23,900, is due to the mitigating effects of an overall favorable capital market environment and the reversal of the previous year’s provision for contribution refunds. As a result of these factors, the contribution rate turned out to be lower than the 1.9 per thousand originally announced by the PSV in July.
Interest rate declarations within the insurance industry
As is customary, several life insurers have already announced their profit sharing for 2026 before the end of the year. The outlook is somewhat uncertain. While many insurers are leaving their profit sharing unchanged (such as Allianz, AXA, DEVK, Ideal, Provinzial, R+V and Swiss Life), some are raising it marginally (as is the case with Alte Leipziger, ERGO and Inter). Current interest rates therefore range predominantly between 2.4% and 3.4%, and the trend seen in recent years towards a moderate increase is set to continue into 2026.
Introduction of the active pension
On December 5, 2025, the Bundestag decided to introduce the so-called active pension with effect from January 1, 2026. The decision was made as part of the pension reform package, together with the safeguarding of pension levels at 48% and an increase in mother’s pension for children born before 1992. Contrary to what the name suggests, the active pension is not a separate pension entitlement, but a tax bonus. A monthly salary of up to 2,000 € earned from employment after reaching the standard retirement age remains exempt from income tax. Furthermore, the existing old-age pension will not be reduced, and the tax-free income will not mean that there is an increase in the tax rate of the remaining taxable income. Social security contributions, on the other hand, must continue to be paid. Self-employed individuals are exempt from this regulation. Anyone who receives an early retirement pension (regardless of whether they are entitled to reductions as long-term insured persons) is only eligible for the active pension once they have reached the standard retirement age. And even if the regulation is highly questionable under the constitutional principle of equal treatment and the cost-benefit ratio is somewhat dubious from a taxation perspective, it does offer many companies and employees additional options for continuing employment beyond the standard retirement age from January 2026 onwards.
Annual EPF General Meeting in November 2025
On November 17, 2025, the annual general meeting was held at the premises of Profion GmbH. This year’s meeting was particularly significant, with the EPF’s long-standing tax advisor and his colleague from the auditing and tax consultancy firm SPITZWEG Partnerschaft stepping down at the end of the year due to retirement. An appropriate send-off was given to both gentlemen. A total of three sponsoring companies were in attendance. After the annual financial statements for 2024 were presented, the planned amendment to the Articles of Association was explained and unanimously approved. Furthermore, Mr. Thiel and Dr. Reich were unanimously re-elected to serve on the EPF’s Executive Board. Concluding the proceedings, Dr. Reich provided a detailed overview of current developments in statutory, private and occupational pension provision, as well as an update on current case law. On this occasion the main topics of discussion were the planned pension reform, in particular the issue of financial viability (keyword: double stability line), as well as the so-called active pension, which conflicts with some of theobjectives being pursued. Following a digression into the Occupational Pension Strengthening Act II, Dr. Reich presented two current, interesting court rulings from the field of occupational pension schemes.
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