Supplementary Income: €410 Threshold and Hardship Adjustment Up to €820
410 €. 820 €. Two numbers, a smooth transition. Up to 410 € in additional income per year is exempt from income tax; in between, the deduction decreases euro by euro; and starting at 820 €, everything counts.
Anyone who receives wages with income tax withheld and earns more than 410 euros in additional income per year must file a tax return (Section 46(2)(1) of the Income Tax Act (EStG)). The decisive factor is the profit or surplus, not the gross revenue. Up to 410 euros, additional income is not taken into account; between 410 and 820 euros, a sliding-scale hardship adjustment reduces the taxable portion.
- The €410 threshold applies to income, not to revenue: what counts is the profit or net income after deducting expenses.
- It is treated the same as wages subject to payroll tax; if your other income exceeds €410 per year, you are required to file a tax return.
- Up to 410 €, additional income is not taken into account for tax assessment purposes.
- For amounts over €410 but less than €820, there is a deduction of €820 minus any additional income; if the amount is exactly €820, the deduction is zero, and from that point on, the full amount applies.
- Wages from mini-jobs subject to flat-rate taxation and investment income subject to withholding tax are not included; wage replacement benefits such as parental allowance have their own €410 limit, but no hardship adjustment.
How much can I earn on the side before I'm required to file a tax return?
Up to €410 per year. Employees who have income in addition to their wages on which no income tax has been withheld must file a tax return as soon as this income totals more than €410 (Section 46(2)(1) of the Income Tax Act (EStG)). If the total is exactly 410 € or less, there is no such obligation.
The key word here is “income.” This refers to profit or net income—that is, revenue minus expenses—not gross revenue. Someone who earns €1,000 in fees and incurs €700 in expenses has an income of €300.
Supplementary Income – Income other than wages from which no income tax was withheld, such as income from self-employment, business operations, or rental income. What counts is the profit or net income, not the revenue.
Up to 410 €
no approachSupplementary income is not taken into account for tax assessment purposes (Section 46(3) of the Income Tax Act). For this reason, no declaration is required.
Over €410 but less than €820
Hardship allowanceAn amount of €820, minus any additional income, is deducted from your income (Section 70 of the Income Tax Implementation Regulation). Filing a tax return is mandatory.
Starting at €820
full amountThe hardship adjustment is expiring; supplementary income is counted in full.
What counts as supplementary income, and what doesn't?
All taxable income that is not subject to payroll tax withholding is added together. This is a total amount, not an individual assessment: Two side jobs, each yielding a profit of €300, total €600 and exceed the threshold (Section 46(2)(1) of the Income Tax Act (EStG)).
This also applies in the opposite direction, since the net amount is what counts: losses are offset. Someone who has a profit of €800 from a side job and a loss of €500 from renting out property ends up with €300. For this reason, there is no obligation to file a tax return. The deduction of up to €410 and the hardship adjustment are also based on this total.
Income that is not considered part of your total income is not included. This includes wages from a “minijob” for which the employer has paid a flat-rate tax, since wages subject to flat-rate taxation are excluded from the calculation (Section 40(3), third sentence, of the Income Tax Act (EStG)).
Interest, dividends, and mutual fund returns that are settled through the bank with withholding tax are also not included. They are only included if you choose to have them included in your income tax under the “more favorable treatment” rule. That’s your decision—it’s not the standard procedure.
Does that count toward the €410 limit?
| Revenue | Does it count? | Reason |
|---|---|---|
| Income from self-employment or a secondary business activity | Yes | Income without payroll tax withholding; it's the profit that counts, not the revenue |
| Surplus from Rental Income | Yes | Income without payroll tax withholding |
| Earnings from a mini-job subject to a flat-rate tax | No | Wages subject to flat-rate taxation are not taken into account (Section 40(3), third sentence, of the Income Tax Act (EStG)) |
| Interest and Dividends Subject to Withholding Tax | No | They remain excluded as long as they are not included in the standard income tax calculation through the "more favorable treatment" rule. |
| Parental Allowance, Unemployment Benefits I, Short-Time Work Benefits | One's Own Limits | They are not taxed themselves, but they do increase the tax rate under the progression clause (Section 32b of the Income Tax Act). If they exceed €410, they are also subject to taxation (Section 46(2)(1) of the Income Tax Act). There is no hardship relief for this. |
| Income Exempt from Income Tax Under the Law | No | Only income subject to income tax counts |
Sources: § 46(2)(1), § 40(3), § 32b of the Income Tax Act (EStG). As of October 2026.
Instructors and Volunteer Work: First the Tax-Exempt Amount, Then the €410
Income from part-time work is tax-free up to €3,000 for 2025 and €3,300 for 2026, Income from volunteer work is tax-free up to €840 for 2025 and €960 for 2026. This applies, for example, to coaches, choir directors, and club board members. These amounts are deducted before the €410 calculation. Only income exceeding these amounts is considered secondary income.
How does the hardship adjustment between €410 and €820 work?
It smooths out the transition. Without it, the calculation jumps: At €410, nothing counts; at €411, €411 counts. Instead, the tax office deducts an amount from income that decreases as additional income rises: €820 minus the additional income (§ 70 EStDV).
For 411 €, the deduction is 409 €, leaving 2 € subject to tax. For 600 €, the deduction is 220 €, leaving 380 €. For exactly 820 €, the deduction has dropped to 0 €, so the full amount is taxable. As a rule of thumb, for amounts between €410 and just under €820: taxable portion = 2 × miscellaneous income − €820.
The deduction of up to €410 also applies if you file the return voluntarily. If you file voluntarily and have €300 in miscellaneous income, that amount will be deducted from your income.
These figures do not include the age-based tax credit or other deductions that may affect the total amount. Exceptions: see source.
Sample calculation: €600 in additional income
- An employee who has income tax withheld earns €600 in profit from a side job during the year
- There is no other income on which income tax is withheld
- No Age-Based Deduction
- As of October 2026
| Additional Income (Profit) | €600 |
| Hardship allowance: 820 € − 600 € | €220 |
| Taxable portion: 600 € − 220 € | €380 |
| Is taxed along with the rest of the income | €380 |
The tax on these 380 € is based on your personal tax rate. You are required to file a tax return because your supplementary income exceeds 410 €.
There is no phased transition for wage replacement benefits
The hardship adjustment applies only to taxable income. Parental allowance, Unemployment Benefit I, and short-time work compensation are tax-exempt and only increase the tax rate. For these individuals, the €410 limit is a real stumbling block: under the hardship adjustment, €600 in additional income counts as only €380, while €600 in parental allowance raises the tax rate on the remaining income by the full amount.
What portion of my additional income is taxable, and do I need to file a tax return?
Model calculation based on the amounts specified in Section 46(2)(1) and (3) of the Income Tax Act (EStG) and Section 70 of the Income Tax Implementation Regulation (EStDV), excluding the age-related tax relief. This calculation does not indicate the actual tax amount. As of October 2026.
When do I have to file a tax return?
Additional income exceeding €410 per year is sufficient grounds (Section 46(2)(1) of the Income Tax Act (EStG)). In addition, Section 46 lists other grounds, such as having multiple employers at the same time (No. 2). An overview can be found in the article on the obligation to file a tax return.
If your additional income is €410 or less and there is no other reason, you are not required to file a return. However, you may still choose to file a voluntary return. In that case as well, additional income up to €410 is deducted from your income (Section 46(3) of the Income Tax Act (EStG)).
The limit applies only to income tax
Whether an activity constitutes a business and must be registered with the Trade Licensing Office (Section 14 of the Trade Regulation Act [GewO]), and whether VAT is due, are determined by other regulations. The €410 threshold does not affect this.
Quick question, quick answer.
Does revenue or profit matter?
Profit or net income. The relevant figure is income—that is, revenue after deducting business expenses or income-related expenses—not gross revenue (Section 46(2)(1) of the Income Tax Act (EStG)).
Does this rule apply to retirees?
It applies to wages subject to payroll tax withholding. Statutory pensions are not subject to payroll tax withholding; they are subject to a separate tax liability based on the basic tax-free allowance (Section 56 EStDV, 2026: €12,348). For retirement benefits subject to payroll tax withholding—such as a pension—§ 46 EStG may apply.
Do I need to register a business?
That doesn't depend on the €410 threshold. Anyone who starts a permanent business must register it with the Trade Licensing Office (Section 14 of the Trade Regulation Act [GewO]). Whether the activity constitutes a business is determined regardless of the amount of income.
Does the limit apply to each activity individually?
No, it's the total that counts. Two side jobs, each yielding a profit of €300, total €600 and exceed the €410 threshold. Losses are offset against profits: a profit of €800 from one side job and a loss of €500 from renting property result in a net profit of €300; therefore, there is no reporting requirement.
Do parental benefits or unemployment benefits count?
They have their own threshold. Income replacement benefits are subject to the progression clause; if they exceed €410 per year, there is also an obligation to file a tax return (Section 46(2)(1) of the Income Tax Act (EStG), Section 32b of the Income Tax Act (EStG)). The hardship adjustment applies to taxable income and therefore does not apply to you: The full amount of €600 in parental allowance increases the tax rate on your remaining income.
Do I have to file a tax return if I have €300 in additional income?
Not because of the additional income, since it is less than €410. Whether there is another reason to file a tax return is governed by § 46(2) of the Income Tax Act (EStG).
Sources & Legal Basis
- Income Tax Act, Section 46: Assessment of Income from Wages – § 46 Abs. 2 Nr. 1, Abs. 3 EStG (08.10.2026)
- Income Tax Implementation Regulation, Section 70: Mitigation of Hardship in Certain Cases – § 70 EStDV (08.10.2026)
- Income Tax Act, Section 40(3): Flat-Rate Withholding of Payroll Tax – § 40 Abs. 3 EStG (08.10.2026)
- Income Tax Act, Section 32b: Progression Clause – § 32b Abs. 1 Satz 1 Nr. 1 EStG (08.10.2026)
- Income Tax Implementation Regulation, Section 56: Obligation to File a Tax Return – § 56 EStDV (08.10.2026)
- Income Tax Act, Section 32a(1) (basic tax-free allowance) – § 32a Abs. 1 EStG (08.10.2026)
- Trade Regulation Act, Section 14: Obligation to Report – § 14 Abs. 1 GewO (08.10.2026)
Change History
- October 8, 2026Post created (draft).
- October 9, 2026Technical review incorporated.
This article is intended to provide general information and does not constitute tax advice for specific cases. For binding information, please contact your local tax office.
Reviewed by expertsSven Schilling
Tax expert- Bachelor of Business Administration (University of Applied Sciences)
- Over 30 years of experience in accounting and tax firms
- Board Member of an Income Tax Assistance Association
Reviewed on October 9, 2026. If there are any changes to the law, this post will be reviewed again.
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