Germany Severance Pay Calculator 2026 (Abfindungsrechner, Fünftelregelung)
Calculate tax on severance pay in Germany for 2026 with the Fünftelregelung of § 34 EStG: income tax, solidarity surcharge, church tax and the net amount.
Since 2025 employers withhold payroll tax on severance without the Fünftelregelung; the relief comes back as a refund in the annual tax return. Severance is free of social security contributions.
What it does
Severance (Abfindung) is taxable income in Germany, but § 34 EStG softens the progression: the tax is worked out on one fifth of the severance added to the year's other income and then multiplied by five. It helps most when the rest of the year's income is low. Severance pays no social security; the usual amount agreed in court is half a monthly salary per year of service.
How to use it
- Type the severance and the taxable income of the year without it.
- Choose married or single and the church tax rate.
- Read the tax with and without the Fünftelregelung and the net amount.
The arithmetic runs in your browser. Nothing you type is sent anywhere and nothing is stored, so you can use these with real numbers.
Frequently asked questions
How much tax on a 60,000 € severance?
With 50,000 € of other taxable income, single, the Fünftelregelung gives 22,315 € of income tax plus 1,489.05 € of solidarity surcharge: 36,195.95 € net, 2,462.92 € more than without it.
How is the Fünftelregelung calculated?
Tax on (income + severance ÷ 5) minus tax on the income alone, multiplied by 5. The lower the other income of the year, the bigger the saving.
How much severance is usual?
There is no general right to severance; the common benchmark (§ 1a KSchG) is 0.5 monthly salary per year of service. With 4,000 € and 10 years that is 20,000 €.
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