Family benefits for children

Tax measures aimed at providing financial relief for parents, especially parents with children under age, are a special feature of German income tax law. These questions and answers will provide an overview of benefits available.

Vergünstigungen für Kinder©Pixelio_S.Hofschaeger.jpg

Children lying on the grass

What tax benefits for my children am I entitled to?

Are there any other tax benefits for my children available?

What tax benefits for my children am I entitled to?

Child benefit and tax allowances for children

Child benefit in Germany is

• €192 per month for the first and second child,

• €198 per month for the third child and

• €223 per month for each additional child.

Subject to certain conditions, child benefit can be granted to UK citizens living in Germany. Claims for child benefit, which is paid monthly, are filed with the Family Benefits Office (Familienkasse) of the Federal Employment Agency (Bundesagentur für Arbeit - BA). For details, please refer to the websites
https://www.arbeitsagentur.de/en and
https://www3.arbeitsagentur.de/web/content/EN/Benefits/ChildBenefit/Detail/index.htm?dfContentId=L6019022DSTBAI494675

Furthermore, tax allowances for children, such as the tax allowance of €2,358 and the allowances covering childcare, education and training for a child (€1,320), may be claimed as deductions from taxable income. These amounts are granted to each parent while parents assessed jointly for income tax will receive double these amounts (€4,716 plus €2,640 = €7,356). Amounts will also double if one parent is deceased or is not subject to unlimited income tax liability.

The local tax office will examine each case to see if it would be more beneficial for a family to receive tax allowances for children or to receive child benefit. The monthly child benefit payments are to be considered as advance payments on the tax allowances for children at the end of the year.

For children over 18 years of age, any tax benefits are taken into consideration upon application only, and only if requirements are met.

For further detailed information on requirements, entitlements, how to claim, amount and payments of child benefit and the tax allowances for children please refer to our information booklet on wages tax, the website www.kindergeld.org or your local Family Benefits Office (www.familienkasse-info.de) (all links in German).

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Are there any other tax benefits for my children available?

Tax relief for single parents

Tax relief for single parents amounts to €1,908 a year for the first child. It may be increased by €240 for each additional child registered as living with that parent. This specific measure aims at alleviating the increasing financial burden on single parents covering their own living expenses.

Childcare expenses

Two thirds (and no more than €4,000) of documented childcare expenses may be deducted per child as special expenses,

• if the taxpayer is entitled to the tax allowance for children or child benefit,

• if the child lives in the taxpayer’s household and

•for children under 14 years of age or children who are unable to support themselves because of a physical, mental or psychological disability that arose before their 25th birthday

School fees

If their child attends private school, parents may deduct 30% of school fees, a maximum of €5,000 (excluding accommodation, supervision and meals) as special expenses, if they are entitled to child benefit or tax allowances for the child.

In order to qualify for this deduction, the domestic school’s leaving qualification (general education, or vocational education) must be approved by the German government.

Further details can be found in the tax brochure for parents (in German).

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