The mini-job model explained in terms of tax and employment law

Yes, this is possible. Marginal employment is also commonly referred to as a mini-job. What constitutes marginal employment is explained in more detail in § 8 SGB IV. According to this, a mini-job exists if the monthly income does not exceed 450 euros. This is the classic 450 euro job.

A second option for a mini-job is short-term employment of a maximum of 3 months or 70 working days per calendar year. The main connecting factor here is the duration of employment. However, there is a restriction here. In these cases, it is not a mini-job if the pay exceeds 450 euros per month and the employment is carried out on a professional basis.

It is important to note the difference between this and a midi job. In the case of a midi job, the monthly income is between 450.01 and 850. This is also referred to as employment in the social security sliding zone. It is subject to the usual social insurance rules, so there is no difference for employers compared to normal employment subject to social insurance contributions. However, the contributions for the employee are relatively low. This is intended to make the transition from a midi job to full employment subject to social insurance contributions as smooth as possible.

On the one hand, a professional activity always exists if the monthly income from the employment exceeds the limit of 450 euros.

On the other hand, it is also deemed to be a professional activity if it is not just a side income to supplement your wallet, but must be used to cover your living expenses. A typical example of this is a person who is unemployed and registered as a jobseeker with the employment agency for more than one short-term job and at the same time works in such short-term employment. These people typically have to earn this income to cover their living expenses.

In addition, it must always be assumed that the same activity is carried out professionally if it is carried out with different employers for more than 3 months or 70 working days in a calendar year.

These limits apply regardless of whether the employment takes place in a business or a private household. Private individuals who employ a cleaning lady, for example, are also employers. They are therefore subject to the same obligations as a commercial employer.

Particularly in the case of regular employment, it can quickly happen that the mini-jobber earns more than 450 euros in individual months, for example due to overtime or sickness cover. The question therefore arises as to whether this already leads to the loss of privileges in terms of tax and social security contributions.

Here we can give a conditional all-clear. The decisive factor is the total earnings in the calendar year. This may not exceed the limit of 5,400 euros (which corresponds to 12 x 450 euros). This includes special payments such as Christmas or vacation bonuses. However, bonuses for work on Sundays and public holidays or at night are not counted. These bonuses are usually tax-free anyway.

In addition, there is an exception to this EUR 5,400 threshold if the additional earnings were not foreseeable. This is possible, for example, if the additional work was due to a case of illness. It is harmless if the limit of 450 euros per month is exceeded in such cases, as long as this monthly income limit is exceeded for a maximum of 3 months per year. The annual income may then also exceptionally exceed the EUR 5,400 limit without triggering a social security obligation.

In specific cases, you can contact our law firm at any time for an individual assessment and advice.

If the marginal employment is carried out on a professional basis, this means that the tax and social security benefits no longer apply. The employment is therefore subject to social security contributions.

Employers should therefore carefully check whether previous periods of employment in the calendar year already exist, particularly in the case of short-term employment relationships. Employers who violate their obligation to pay social security contributions are liable to prosecution and must expect severe consequences. If in doubt, you should seek the assistance of an experienced lawyer to check this.

Yes, mini-jobs must be registered with the mini-job center with the first pay slip or no later than 6 weeks after the start of employment if it is a regularly recurring service. In sectors with an increased risk of undeclared work, there is even an immediate obligation to register from the first day of employment. In addition, mini-jobbers must also be registered with the statutory accident insurance by the employer. Otherwise, they are not insured in the event of accidents at work. The employer must then bear the accident and treatment costs.

Employers who do not comply with the obligation to register must expect a fine of up to 5,000 euros.

The only exception to the obligation to register is if the activity is occasional and irregular, such as occasional babysitting.

The advantage for employees lies in particular in the privileged treatment of taxes and social security contributions. In contrast to an employment relationship subject to social security contributions, the employer alone pays the contributions. The net wage is therefore also the gross wage. In addition, there is now parity with employment relationships subject to social insurance contributions with regard to vacation entitlement, protection against dismissal and minimum wage.

The disadvantage, however, is that only small pension insurance contributions are paid if the mini-jobber is not exempt from compulsory pension insurance anyway. This results in a very low entitlement to the standard old-age pension from the statutory pension insurance.

Minijobbers can easily register with the Minijobcenter online, by telephone or by post. Paying contributions is also straightforward. In addition, employer contributions are lower than for employees subject to social insurance contributions. By using mini-jobbers, the employer can react well to seasonal fluctuations in workload. As the net wage for the mini-jobber corresponds to the gross wage, the employer can also reduce wage costs here by paying a lower gross wage.

There are also additional advantages for private employers of household-related services. They have to pay even lower contributions than commercial employers. They also receive additional tax benefits. This is because private employers can deduct the costs of the mini-job of 20% per year up to a maximum of EUR 510 from their own tax liability.

No, with the increase in the minimum wage to 12 euros, the income threshold for mini-jobs will also be adjusted. This will therefore rise to 520 euros per month from 01.10.2022.