Tax return: Lump sum for exercise leaders (Übungsleiterpauschale)

Millions of people are doing voluntary work in Germany. They distribute food to people in need, care for strangers, provide support to charities, and pass on valuable life skills to younger generations. The scope of volunteering is almost limitless.

Anyone who does volunteer work can earn a certain amount of tax-free income. The Treasury does not participate in these revenues. But what is there to pay attention to?

Benefit from lump sum for exercise leaders (Übungsleiterpauschale)

If you are socially involved as an exercise leader on a part-time basis, you can benefit from a tax concession for income from this activity. The lump sum for exercise leaders exempts a fixed amount from tax and social security contributions. Until the end of 2020, the lump sum was 2,400 euros per year; from 2021, it will increase to 3,000 euros. However, there are a few requirements that must be met in order to make use of it.

The basic condition is that the instructor does one of the following activities on an honorary basis:

  • Coach in a sports club
  • Artistic director of certain activities (for example choirmaster)
  • Training manager
  • Instructor
  • Educator
  • Supervisor
  • Care of persons in need of assistance

What to pay attention to

An honorary office, in this case that of an exercise leader, should be fundamentally different from the actual main occupation. The lump sum for exercise leaders can also be claimed if no main occupation is pursued. This means that pensioners, students and others can also benefit from the lump sum.

The lump-sum for exercise leaders is not only tax-free, but also exempt from social security contributions. Anyone who earns more than the amount must pay tax on the sum that exceeds the limit.

If the above-mentioned amount of the lump sum is exceeded, the income beyond the lump sum must be taxed. If a person performs several exercise leader activities, the incomes are added together. This does not increase the lump sum.

For example, a trainer may receive a lump sum at two clubs. It would be conceivable that a trainer, for example, receives 1,400 euros per calendar year at club A and 1,600 euros per calendar year at club B.

Prerequisites for the lump sum for exercise leaders

In order to be able to claim the lump sum for exercise leaders, a number of requirements must be met.

The activity must:

  • be a training, educational, caring, artistic or nursing activity
  • serve charitable, benevolent or ecclesiastical purposes
  • be carried out on a voluntary basis for a non-profit organisation or a legal entity under public law
  • be part-time

What are charitable, benevolent or ecclesiastical purposes?

Institutions with charitable purposes aim to promote the general public materially, spiritually or morally.

Non-profit purposes include, among others:

  • Youth welfare
  • help for the elderly
  • work in the conservation/preservation of historical monuments
  • activities for the protection of animals
  • activities for the purpose of equal rights for women and men

Charitable purposes include:

  • Work that helps people to overcome emotional, mental, physical or economic difficulties

Ecclesiastical purposes include:

  • Religious education
  • preaching ministry
  • Dealing with ecclesiastical administrative tasks

Some activities do not meet the criteria for the lump sum for exercise leaders because the educational or nursing task is missing. For example, treasurers, caretakers or other club leaders in sports clubs and religious communities perform an honorary office, but do not fulfil an educational or nursing task. For such honorary positions in a non-profit or charitable organisation, there is the so-called volunteering lump sum. Up to and including 2020, it amounts to 720 euros per year. In 2021, the honorary flat rate will be increased to 840 euros. The activity must pursue charitable, benevolent or ecclesiastical purposes and be carried out on a part-time basis.

If a person performs both an exercise leader activity and another voluntary activity, the lump sum for the exercise leader activity and the lump sum for the other voluntary activity can be claimed at the same time.