With the personal allowance you reduce your income tax and pay in the end thus not less tax, but receive more net salary each month.
If you have allowances entered in your tax card (Elstam), an even larger part of your gross salary remains tax-free. Allowances can be given for expenses you would otherwise report on your tax return, such as job expenses, second home, another child, medical expenses. Most tax allowances are only recognized when a 600 Euro limit is reached.
To apply for the 2021 wage tax allowance, you must submit a tax return to the tax office no later than 30.November to file an "application for payroll tax reduction".
If you have claimed an allowance, you are obliged to file a tax return. Except, you have a gross wage up to 10.700 euros if you are single / up to 20.200 euros for married couples, or you have applied for a disability allowance or survivors' allowance
Why apply for wage tax allowance?
As an employee, you can convert your anticipated income-related expenses, special expenses or extraordinary burdens into a 2018 personal income tax allowance, thereby reducing your income tax. In this way, you will not pay less tax, but you will have more net salary in your pocket each month and you will avoid a free loan to the tax authorities in the form of overpaid income tax.
Wage tax is deducted according to lump-sum tax allowances, which are incorporated into the wage tax classes, without taking into account the specific situation of the employee. Thus, the state collects more than it is entitled to in most cases.
Do I have to report the new wage tax allowance to my employer?
No, your employer will receive your registered tax allowance automatically via the electronic wage tax card and will take it into account in your salary statement.
How can I find out my wage tax allowance?
Your wage tax allowance is stored with all other personal tax deduction characteristics in the ELStAM database of the tax office. From here, the tax characteristics are retrieved by the employer for payroll purposes.
- The easiest way to see your personal allowance is on your payslip, because your boss is obliged to show the ELStAM data here.
- You can ask the tax office, or
- Look up your tax data yourself in the Elster online portal. However, in addition to your tax ID / tax number, you will also need an electronic certificate, which you must apply for in advance.
Apply for a tax allowance
When should I apply for the wage tax allowance?
You can use the wage tax allowance 2021 up to the 30th day of the year. Apply in November. The allowances are entered into the ELStAM database.
Tip: The right time to apply for wage tax reduction
- Increase maternity pay or sick pay: An allowance can increase maternity pay if you apply for the allowance no later than 3 months before the start of maternity leave You can increase your sick pay if you apply for an allowance no later than one month before the start of incapacity for work.
- Reduce wage tax for Christmas bonus: A tax allowance always takes effect on the next first of the month. Those who apply in November will have the entire annual allowance taken into account in the December payroll. So you can keep the wage tax low for the Christmas bonus paid in December.
How long is an income tax allowance valid for?
You can apply for an allowance for two years at the tax office.
How to apply for the wage tax allowance?
To do this, fill out the "Application for wage tax reduction" form.
In some cases, the tax office requires proof that the claimed expenses will actually occur in the future. Travel to work or, for example, study costs for the children can be easily verified. In cases that cannot be proven, such as a planned purchase of expensive work equipment, you must credibly explain to the tax office what investments are in store for you.
Application for wage tax reduction – forms download
Complete the "Application for wage tax reduction" and the corresponding annex on income-related expenses, special expenses/extraordinary burdens and children.
From 2018, the previous forms "Application for wage tax allowance" and "Simplified application for wage tax allowance" have been merged into one form. There are three attachments to this that should be completed as needed:
Calculate your tax allowance
Prerequisite for the recognition of an income tax allowance is that your expenses exceed the 600 Euro limit.
The 600 € limit does not apply to all expenses, household-related services, such as craftsmen and cleaning help are excluded.
Calculation example: How to check the 600 Euro claim limit
You drive 20 kilometers to your work on 220 working days and pay 1.600 EUR to your childminder.
|Travel to work: 220 days x 20 kilometers x 0,30 Euro||+ 1.320 €|
|minus. Employee lump sum||– 1.000 €|
|Special expenses for the childminder||+ 1.600 €|
|You can apply for a wage tax reduction, because the sum of the costs is above the 600 Euro limit.|
Example: How to calculate the income tax allowance?
In June you apply for a wage tax reduction. How high is your monthly tax-free amount?
|Allowance calculation for income-related expenses|
|Travel to work: 220 days x 20 kilometers x 0,30 Euro||+ 1.320 €|
|minus. Employee lump sum||– 1.200 €|
|Total income-related expenses||= 120 €|
|Allowance calculation for special expenses|
|Childminder||+ 1.600 €|
|minus. Special lump sum for expenses||– 36 €|
|Total special expenses||= 1.564 €|
|Calculation of total income tax allowance|
|Allowance per year ( 120 € + 1.564 € )||1.684 €|
|Allowance per month (July to December)||114 €|
|From July you will be entitled to 314 Euro allowance per month.|
For what there is income tax allowance?
Wage tax allowance without 600 € application limit
These allowances can be entered in the income tax card without any restrictions (without reaching a 600 Euro limit):
- Handyman services in the household: for handyman wages, travel and machine costs (no material costs): Up to 4.800 euros
- Domestic help as 450 Euro job: Up to 2.040 euro
- Domestic help self-employed or employed: Up to 16.000 Euro
- Survivor's lump sum: 370 Euro
- Disability allowance: Depending on the degree of disability 310 – 3.700 euros
- Losses carried forward: single person up to € 1 million / spouse up to € 2 million
Wage tax allowance for expenses of 600 € or more
The following allowances are only recognized if a 600 euro limit is reached. So only if the sum of your income-related expenses from non-independent work, special expenses and extraordinary expenses of a general nature is more than. So you have to pay z.B. 1.600 Euro income-related expenses (employee lump sum of 1.200 EUR plus 600 EUR application limit) must be presented in order for the allowance for income-related expenses to be taken into account.
Wage tax allowance 2022 for income-related expenses
(after deduction of the lump sum for income-related expenses of 1.200 euros and the application limit of 600 euros)
- Travel expenses to work (distance allowance): For each kilometer of single distance to work 0.30 euros / from 21. kilometer 0,38 Euro, maximum 4.500 Euro per year. Expenses for public transportation with receipt.
- Travel expenses: Only travel expenses not reimbursed tax-free by the employer. For each kilometer driven by car 0,30 Euro, by motorcycle 0,20 Euro or costs for public transportation.
- Work equipment: professional clothing, tools, technical literature, home office equipment, etc. If the net acquisition costs exceed € 800, the work equipment must be distributed over its useful life.
- Study: You can deduct a study, which is located outside of your home or in the center of your entire professional activity, without limitation. Otherwise a limit counts up to 1.250 Euro per year.
- Double housekeeping: Travel between the second home and the place of work and travel expenses for one family home trip per week (distance allowance), meal allowance for the first three months For each day at the place of work – 28 EUR/day, days of home and return trips – 14 EUR/day. costs for the garage.
- Continuing education expenses for students, training: Professional training: Secondary education / studies, doctorate for the achievement of a doctorate. Expenses for technical literature, learning materials, examination fees…
- Relocation: Lump sum for job-related relocation in 2022: The lump sum for relocation expenses will increase on 1. April 2022 for singles from 870 to 886 euros.
Income tax allowance 2022 for special expenses
(after deduction of 36 euros for single persons / 72 euros for married couples)
- Maintenance for the ex-partner: Maintenance lines after divorce / separation to ex-partner up to 13.805 EUR per year
- Education expenses – students, trainees: First vocational training and first degree up to 6.000 EUR per year
- Church tax: Paid church tax (but not church tax on final withholding tax).
- Childcare costs: up to 2/3 of the costs, maximum 4.000 euros a year for kindergarten, daycare, etc. For children up to 14 years of age living in the household or disabled persons without age limit, if they were born before the age of 25. were disabled before the age of.
- Donations to political parties: single up to 1.650 euros / spouse 3.300 euros
- Donations for charitable, benevolent and ecclesiastical purposes: up to 20 percent of total income.
- Tuition for private school: Up to 5.000 Euro per year, for each child 30 percent of the school fees.
Tip: Tax tip for students
You cannot deduct the costs of your first professional training or studies as income-related expenses, but up to the amount of 6.000 Euro to be claimed as special expenses. If they do not earn any income in the same year, they go empty-handed. Tip: You should still always try to bring your costs through as advertising expenses! If you do not earn any income during the initial studies, still declare the costs of the initial education as income-related expenses in an unlimited amount. As "anticipated income-related expenses", they can lead to losses recognized for tax purposes, which you can have carried over to subsequent years.