Ah taxes… Don’t we just all love it?
Probably one of the most boring topics to deal with but also one of the most essential ones, especially in Germany. There are many factors impacting on your income tax rate; few of them are more important than your tax class.
In this post, we will go over what it all means and if you think it’s relevant to your situation, how to change your tax class in Germany.
Tax classes in Germany: TL;DR
In nutshell; your tax class in Germany is more or less defined by your marital status. Depending on this, you will be put in different categories by the Finanzamt. This will help your employer apply the correct tax rate on your payslip, hence the name “Lohnsteuerklasse”. This impacts how much wage tax (“Lohnsteuerabzug”), solidarity contribution (“Solidaritätszuschlag”) and Church tax (“Kirchensteuer”) will be taken from your gross salary.
In other words, your net salary is directly related to your tax class in Germany.
As you might have already guessed it; this is only relevant to employees. Self-employed are paying income tax through other means.
Quick overview
There are 7 categories overall.
| Tax class | Marital status |
|---|---|
| Steuerklasse 0 | You are not a German resident. |
| Steuerklasse 1 | You are single, widow(er), separated/divorced |
| Steuerklasse 2 | You are a single parent |
| Steuerklasse 3 | You are married with a higher income (than your partner in Steuerklasse 5) |
| Steuerklasse 4 | You are married with both equivalent income |
| Steuerklasse 5 | You are married with a lower income (than your partner in Steuerklasse 3) |
| Steuerklasse 6 | The class used for additional jobs (Nebenjob or Zweitjob) |
Attention married people: you can save money
As you can see, married people can belong to different classes and optimize differently. By default, the Finanzamt will put both partners in tax class 4, when you first register your marriage or marry in Germany. However, for a lot of households, this is often not the best solution. Why, you ask?
It’s quite simple really: the German tax system knows that the higher-earner is often bearing more of the costs in the household. The idea here is to allow for a tax rebate when one of the partners earns significantly less than the other. As a result, moving from tax class 4 to tax class 3/5 might increase the net salary for the higher earner.
When is it worth to change classes in that case?
The higher-earner in the household has to earn a good deal more for this to make sense. They should earn at least 60% of the total household income.
How to change tax classes in Germany
Offline with a form
The process to change tax class in Germany is fairly simple:
- Get a hold of the form “Antrag auf Steuerklassenwechsel bei Ehegatten” (Request for tax class change for married people). You can fill it online on the official finance ministry website this way When you have filled both pages in, you can download it as a PDF. Alternatively, you can download an empty PDF file here.
- Print-it and sign it (both partners)
- Send it to your Finanzamt
Online with Elster
- Login with your Elster account and head to this form.
- Select the year for which this should take place (you can select the current year if application is sent before the last day of November)
- First page is your personal details.
- Second page is your partner’s details.
- Ignore 3rd page if you do this application yourself. This is meant for tax consultants.
- 4th page is about stating what your current tax class combination is, and which one you want to switch to.
Important notes
- The tax class change will happen on the month following the request submission. So that’s when you can see a difference in your net salary.
- If both partners are employees and you have been through a tax class change in Germany, it is mandatory to submit a tax declaration (Steuererklärung; more info this way) after the end of the year (e.g: do one in 2022 for the year 2021, if you changed in 2021)
Tax class switch Germany – FAQ
Provided you make the application before 30/11 of that year, you can benefit from that tax cut for the months prior too.
You can use this very easy to use simulator. Enter both your gross salaries in it, together with your postal code. You will be able to see if it’s worth to make a tax class change in Germany, and who should be on tax class 3.
In most cases, this is only possible once a year. However, it is possible to do this more often in the following cases:
• When your partner is not an employee anymore (becoming a freelancer, retirement, parental leave, unemployment).
• When your partner is an employee again.
• When one of the partners passes away.
• In case of divorce or separation.
Very logically, life events that were just previously listed can be cause for change of tax class in Germany; marriage, divorce, death of partner, unemployment, retirement, parental leave, becoming a freelancer.
You would use this form (Erklärung zum dauernden Getrenntleben) to signify the Finanzamt that you are now separated from your partner. The adjustment will be then made automatically after they process this document. You can also do this via Elster here.
For a tax class change to be possible, both partners need to be “unbeschränkt einkommensteuerpflichtig“, which means to be subject to an unrestricted income taxation. In practical terms, this is made possible only when the partner is also a German resident. However, an exception to this rule is possible if you and your partner fulfill the following requirements (source):
• You have EU or Swiss citizenship.
• Your partner has residence in another EU country (+ Switzerland).
• At least 90% of the total income is subject to German income tax. The same applies if the income not subject to German income tax does not exceed 18 336€ in a calendar year.
Hope this little guide helped. Don’t hesitate to leave a comment if anything is unclear.
Hi Bastien,
Firstly, thank you for writing such a formative article-this is extremely helpful!
Do you know where I can clarify one query: We got married at the end of 2021 (21.12 to be precise!), and we were told we’d be able to retroactively change our tax code to 3/5 or 4/4 to receive benefits. Is this a possibility or a too good to be true tale?
Thank you in advance!