Fringe benefits include all sorts of different things, from free beverages and snacks, wellness opportunities, free child care, and even stock option plans and retirement benefits.

Not only do fringe benefits help companies attract and retain employees, but they also have a positive side effect: they can either be granted tax-free or are subject to a relatively lower income tax, while being exempt from social security. This can often result in lower costs for employers than if they offered employees a higher gross salary so that employees could fund these benefits from their net wages.
Particularly when the company is located far away from a city, an onsite cafeteria can be particularly attractive. Although the benefit resulting from free or low-cost meals at the company's cafeteria or the issuance of meal vouchers is subject to income tax and social security, as a rule it is only taxed at the official value of in-kind benefits. If this benefit is provided in addition to the salary, the employer can also tax it at a flat 25% income tax rate plus solidarity surcharge and church tax, leaving it exempt from social security.
The employer can also apply a flat rate tax to an allowance for the employee's travel to and from work, but this flat rate is limited to 15%, either up to the amount of the commuting allowance or up to the actual costs if public transport is used. This flat-rate taxation also means that the allowance is not subject to social security.
As always, employees particularly appreciate being provided with a company car. This benefit is subject to income tax and social security, but various calculations have shown that it can be less expensive for the employer to provide employees with a company car for their personal use. Otherwise employers would have to increase salaries for employees to pay for their own personal automobiles.
A particularly useful way to encourage employee loyalty is a stock option plan. Employees are granted options to buy shares in the employer's company on advantageous terms at a future point in time or over a period of time. What makes this particularly attractive: The prospect of investing in the company and its success increases the employee's commitment and his willingness to work hard. There are also tax benefits when the shares are purchased, because the gain in the amount of the difference between the market price of the investment and the amount paid by the taxpayer is not taxed until the option is exercised (when the employee obtains the power to dispose of the share). Under certain conditions the maximum income tax and social security exemptions can be taken into account. Stock option plans can also be structured in many different ways, so that the individual needs of the employer and the employees are considered.
Finally, it is clear that even young employees begin thinking about security for their old age and asking about retirement benefits. They often assert their statutory right to a company pension plan through deferred compensation. Company pension plans are attractive to employees because the amounts paid by the employer to establish them are to a certain extent exempt from income tax and social security. Although employees must pay taxes on retirement benefits once they retire, they are often then subject to a much lower personal income tax rate than during their working life. This can provide employees not only with security in their old age, but also a real tax advantage.
Whether an employer should offer fringe benefits in order to attract and retain qualified employees, and if so, which benefits to offer, is not a matter of having the largest number of possible benefits available. It is more important for the benefits to be customized to the employees' personal and professional needs and let them know that they are valued by the company, while also giving them financial added value.