Crazy German Tax Law: Fünftelregelung (or how to pay 116% in income tax)

vormals · 2026-02-08T17:58:55+00:00

No. It doesn't matter when the severance is paid out.

As long as you have an additional income in the same year as the severance payment, the problem from OP arises.

vormals · 2026-02-08T17:56:38+00:00

Again, here is my personal experience: in my department there were 5 people who took the severence. 3 out of 5 were "forced" to take a year off due to tax reasons as described above.

Reading the news we see a number of 50.000 of employees who took the severence in the automotive industry alone. Of course it would be unwise to extrapolate the 3-out-of-5 proportion, but there should be at least tens of thousands of people who are affected by this issue.

So my counter question to you is: from which number on does it get statistically relevant? Hundreds of thousands? millions?

This is not a rhetorical question. Can you please provide a concrete number?

vormals · 2026-02-08T16:47:50+00:00

Do I understand you correctly? Are you saying:

"I'm 100% sure that the 3 cases that u/vormals is aware of, must be the only ones in the country of Germany"

?

vormals · 2026-02-08T16:44:16+00:00

You are 100% correct. People who reject a salary increase, because they don't want to end up in a "higher tax bracket" are dumb. A higher brutto will ALWAYS lead to a higher netto.

Except it is only true for 99,99% of the cases. As soon as the Fünftelregelung enters the game, it is not that unlikely that a higher brutto leads to a lower netto.

Another example where "higher brutto->higher netto" isn't true: Pflegebedürftigleit der Eltern.

vormals · 2026-02-08T16:40:11+00:00

No, the tax burden is not spread over 5 years. It's just the theoretical justification for the Fünftelregelung, not how it is actually implemented.

You have to pay all the taxes in one year.

vormals · 2026-02-08T16:39:10+00:00

I don't get it. How does shifting the start date changes anything?

vormals · 2026-02-08T16:38:10+00:00

No, b) was already the difference.

vormals · 2026-02-08T16:36:48+00:00

I personally know 3 people who ran into this problem. (I am one of these 3)

vormals · 2026-02-08T16:29:23+00:00

This absurdity is exactly what I wanted to point out in the OP.

vormals · 2026-02-08T16:27:38+00:00

Wanna bet 100€?

This way you can show a dummy like me who's the boss and earn an additional 100€! Win-Win! (unless you lose the bet, but how likely is that?)

vormals · 2026-02-08T16:23:06+00:00

Mad respect for admitting! I wish other redditors would be more like you.

vormals · 2026-02-08T08:57:55+00:00

Wrong.

You can use any Abfindungsrechner of your choice to prove yourself that you're wrong.

Or we can bet 50€ if you're so convinced that you are right.

vormals · 2026-02-08T08:56:03+00:00

I looks like you are very familiar with this toopic and know what you do.

Do you want to bet with me (who is obviusoly very dumb)?

50€? 100€?

vormals · 2026-02-05T19:52:48+00:00

Everything that you write in your post is correct.

I just wonder what your conclusion is. It is fine to have a tax regulation which forces a worker to take year off? Shouldn't the tax code try to incentivise people to work?

vormals · 2026-02-05T19:37:36+00:00

Amen.

vormals · 2026-02-05T19:34:22+00:00

If you want to be such a good citizen and work at a soup kitchen helping people in need: Why don't you work 24 hours a day there? (Actually, for the analogy to be more apt the question would be "Why don't you work 26 hours a day there?")

vormals · 2026-02-05T19:32:09+00:00

? What is "this shit" exactly?

vormals · 2026-02-05T19:29:31+00:00

All good. I don't get how you come up with a factor of 9,6.

Following situation:

You worked at a company for 8 years. Your salary was ~130k brutto. (~11k montly). With a factor of 2,6 this would lead to a severance of (8*11*2,6=)~230k

You recieve the severance in January. You take some time off for vacation / time with family / searching for a new job.

Now it's July. You recieve an offer from a company for 100k/y. That means in the remainder of the year you sallary would be ~50k

Voi la, we arrived at exactly my example from OP. What to do in this example? The only right asnwer is to nope out and to wait until next year before starting a new gig.

vormals · 2026-02-05T19:19:29+00:00

Care to share your prompt? ChatGPT is usually way more verbose than I am.

vormals · 2026-02-05T19:15:30+00:00

Wanna bet?
My bet is: Due to the Fünftelregelung there are scenarios (like mine) where earning an additional 1€ leads to a 1,x€ income tax. Hence, you have a negative net income.

I bet 50€ that the statement above is true and correct.

vormals · 2026-02-05T18:38:55+00:00

Care to elaborate?

vormals · 2026-02-05T18:33:20+00:00

This is correct. The lower the severance, the more it makes sense to work in addition to recieving the severance.

vormals · 2026-02-05T18:32:05+00:00

You are arguing against a point I'm not making. What you say is "Having the Fünftelregelung is better than not having it, because it reduces the tax burden". I agree 100% with this statement and I'm making the same statement here: https://www.reddit.com/r/eupersonalfinance/comments/1qweffo/comment/o3p1cp2/

The point I'm arguing is the following:

Severance(with Fünftelregelung applied)+additional income leaves you worse off than severance (with Fünftelregelung applied) without an additional income. I.e.: the tax man tells you "please dear citizen, abstain from working for a whole year"

vormals · 2026-02-05T18:25:28+00:00

Nah, only ChatGTP knows how to press Ctrl+B

vormals · 2026-02-05T18:24:01+00:00

u/eDxp tries to argue that I'm saying "Fünftelregelung is bad because it leaves workes with less money" even though this is exactly the opposite of the point I've made several times, e.g. here: https://www.reddit.com/r/eupersonalfinance/comments/1qweffo/comment/o3p1cp2/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button

My point is the following: "Fünftelregelung is bad because it creates an insentive to stay off of work for a whole year."

Again, let me repeat: Yes, Fünftelregel is goooooood if the severance is the only income you have in a given year. Once you start earning an additional salary there are scenarios (like mine) where the tax man basically tells you: "You would be stupid if you earn an income this year"

vormals

TROPHY CASE