Tax Class

Which income tax class you belong to in Germany?

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Moving to Germany from another country and to work have to go through a lot of formalities and it is also important to know which income tax class you belong to. Before that, make sure you have Tax Id

All employees are classified into tax categories for the wage tax deduction (Einkommensteuer). The income tax is paid to the government from your gross salary and it is automatically deducted from your monthly paycheck.

The minimum taxable gross income is €9,169 (no tax is charged under this amount). The tax rate starts from 14% and goes up to 45% for the highest earners (over €265,327).

The income tax class depends on your marital status and divided into 6 tax classes (Steuerklassen)

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Class I:

All employees who are single, living in a registered civil partnership, divorced, widowed or married unless they fall under tax category II, III, or IV.

Class II:

Applies to employees who are single parent

Class III:

Applies to employees who are married and

  • Spouse reside in Germany
  • Spouse doesn’t earn a wage or Spouse earns a wage and classified under Tax Class V

Class IV:

Applies to married couple and earns a equivalent income and reside in Germany.

Class V:

Applies to married employees and earns a less income than partner (classified under class III)

Class VI:

Employees who are receiving multiple wages from more than one employer (Multiple jobs)

How can you change Tax Class?

When you married and your spouse is residing in Germany, then you are eligible to change the tax class.

  1. Fill and signed application from both partners, you can fill the application form online
  2. You can visit Finazamt or send a post based on your residence

They will process the form on the spot and give you newly printed Lohnsteuerkarte with new tax class

Important tips:

  1. If spouses belong to class III and V, it’s better to file as a Joint tax return and will receive only one tax assessment (Steuerbescheid), also will receive a refund to one account if any.
  2. If one of the partners earns a higher income (income ratio of 60:40), then it makes sense to change class to 3 and 5 and this might increase the net salary(Nettogehalt) of the higher earner.

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