Jahresboni

Jahresboni, often called Jahresbonus or annual bonus, is a form of variable compensation paid to employees or executives on a yearly basis. It is designed to reward performance and/or reflect the profitability of the employer, supplementing the base salary.

The payout can take different forms. It may be discretionary, awarded at the employer’s judgment, or contractual and tied to predefined targets (target-based or performance-based bonuses). Some plans combine personal performance metrics with company or department results, while others use profit-sharing or retention incentives. The bonus is typically calculated as a percentage of the annual base salary or as a fixed amount, with target levels specified in the bonus plan or employment contract.

Timing and conditions vary by organization. The amount is usually determined after the annual review and paid after year-end, sometimes in the following year. Pro-rating is common for employees who join or leave partway through the year. Payouts may be subject to meeting minimum thresholds, such as personal performance ratings or company profitability.

In the German context, Jahresboni are treated as part of taxable income and are subject to income tax and social security contributions, similar to regular wages. Companies document eligibility and calculation rules in bonus agreements or plan documents. While they can enhance motivation and retention, annual bonuses also introduce variability into total compensation and may depend on factors within or outside the employee’s control.