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Income tax exemption for child benefit in Germany

Updated: Aug 20, 2022

Allowances for children make the subsistence level of children tax-free in Germany. The allowances for children are more valuable to some parents than the child benefit.

Parents either receive child benefit or the child allowance for income tax. During the annual income tax assessment, the tax office determines whether the allowances for children or child benefit paid out are more favorable to the parents. There is no need to apply for this check since it is automatic.

Allowance for children has been increased

In 2021 and 2022, the child allowance will be 5460 euros (2730 euros per parent). There is also an allowance of EUR 2,928 (EUR 1,464 per parent) for childcare and education. Both allowances are combined when assessing income tax.

Tax allowances for children in the individual years are taken into account with the following total if the parents are married and assessed jointly:

2020: 7812 Euro

2021 and 2022: 8388 euros

When spouses are assessed separately, each parent is assessed half the amount.

Children up to the age of 18 are generally considered during the assessment. In addition, children under 21 who are unemployed and registered as looking for work in Germany are also considered.

Adult children under the age of 25 will be considered if they be trained for a profession (apprenticeship, study), are in a transitional period of no more than four months between two training phases, cannot start or continue vocational training due to a lack of training places, do a voluntary social year, a voluntary ecological year, a federal voluntary service or an international youth voluntary service.

Children who are physically, mentally, or emotionally incapable of supporting themselves, if the disability occurred before the age of 25, are also considered.

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