CHILD BENEFITS/ALLOWANCES IN THE GERMAN TAX SYSTEM

The following is a brief overview of the main child benefits and allowances available in the German
tax system:

1. Monthly Payments - Kindergeld

Kindergeld is certainly the main benefit available for families with children. It is paid
directly into your bank account on a monthly basis. Currently the monthly payments are
184 for your first and your second child, 190 for your third child and 215 for every
child thereafter.
Children qualify up to the age of 25 as long as they are in education and do not have their
own income.
It is important to note that even children living outside of Germany can qualify for
Kindergeld. It can happen that you already receive similar child benefits from a foreign
state where your child is living. Should this benefit be smaller than the entitlement under
German law, it may be possible that the German state will pay you the difference.
In order to receive Kindergeld payments you need to actively apply for it (you will not be
prompted). Your application (Antrag auf Kindergeld) needs to be submitted to your local
Familienkasse which is typically a part of your local Agentur fr Arbeit office
(www.arbeitsagentur.de).

2. Child care expenses

a. General
Child care expenses can be claimed as a tax deduction for children up to the age of 14.
You can claim 2/3 of your expenses, capped at 4,000 per child per year. Please note
that this covers typical day care expenses like crches, kindergardens, babysitters,
nannies, etc.
It does explicitly not cover tuition (see also below for private schooling) or course fees
such as music or sport education.
This benefit is claimed through your annual tax return and requires a receipt to
evidence your payment (cash payments are excluded).
b. Nannies, Babysitters, etc.
Provided you employ somebody (part time or full time regular employment contract,
subject to social security contributions) to mind your children in your home, you can

Thomas Zitzelsberger, Steuerberater accountant - Spitzelbergstrae 12 B, 81476 Mnchen, Germany Tel 0049-(0)89-92 13 13 96 0;
Fax 0049-(0)-89-92 13 13 96 1 www.expattax.de; info@expattax.de

get a tax credit of 20% of the labour cost capped at 4,000 per year / per child against
your total annual tax bill.
This benefit is claimed through your annual tax return.

3. Private Schooling
If you send your children to a private (fee paying) school instead of a free state school, you
can claim 30% of the tuition fees capped at 5,000 per annum, per child as a tax
deduction. As of grade 10 a successful claim can depend on the school and the chosen
course program.
The deduction covers tuition only. It does not cover the cost for accommodation, food,
transport or after hour activities. College fees are unfortunately not covered either.
Under German law, children must attend school as of the age of 6. Should you send your
child to a private school at a younger age (as provided by many international schools), this
is seen as your personal choice and you will unfortunately not qualify for this deduction as
long as your child is under 6 years of age.
According to rather recent court decisions, you can also qualify for this deduction if your
child attends a private school in some other EU-member state.
This benefit is claimed through your annual tax return.

4. College Education Extra Cost for Accomodation

While your childrens college fees as such are not deductible against your income, you will
be able to claim an annual amount of 924 per child per annum as a tax deduction, if they
live away from home due to their college education.
This benefit is claimed through your annual tax return.

5. Elterngeld
Parents who reduce or give up their work during the first 12-14 months of their child being
born in order to care for it, can claim 67% of their lost net income as a payment from the
state. The amount is capped at 1,800 per month and is based on the average monthly
income during the 12 month period before the baby is born.
Elterngeld is paid for up to 12 months and can be extended for another 2 months, if the
other parent reduces or gives up work for an additional 2 months.
The minimum monthly payment for any parent couple (even without income loss) is 300
for a 12 month period.
If you are a Non-EU citizen, it may be required that you have been living and working in
Germany for at least 3 years prior to the baby being born and that your work permit status
allows you to stay.
You need to actively apply for Elterngeld. There are regional differences where to send
your application (www.elterngeld.de for more details) .

Thomas Zitzelsberger, Steuerberater accountant - Spitzelbergstrae 12 B, 81476 Mnchen, Germany Tel 0049-(0)89-92 13 13 96 0;
Fax 0049-(0)-89-92 13 13 96 1 www.expattax.de; info@expattax.de

Outside of the main benefits as described above, you may also qualify for various minor claims and
deductions where children play a role (i.e. increased relocation allowance for families with
children, etc.).
Please note that the above material is designed to give you a brief overview of the main aspects of
what is available. It cannot replace a detailed analysis of your situation by a professional advisor.
For more information in English language please feel free to contact EXPATTAX, Thomas
Zitzelsberger Steuerberater accountant, tz@expattax.de, www.expattax.de

Thomas Zitzelsberger, Steuerberater accountant - Spitzelbergstrae 12 B, 81476 Mnchen, Germany Tel 0049-(0)89-92 13 13 96 0;
Fax 0049-(0)-89-92 13 13 96 1 www.expattax.de; info@expattax.de