Which tax class applies to whom?
Choosing the correct tax class is crucial for the amount of income tax withheld monthly. In Germany, there are six tax classes based on personal circumstances. Here you can find out which tax class applies to whom.
Income Tax Class I
This tax class applies to individuals who are single, widowed, divorced, or permanently separated. Married individuals with a spouse living abroad also fall into this tax class.
Income Tax Class II
Tax class II is specifically for single parents who are entitled to the relief amount for single parents. The requirement is that they live with at least one child for whom they receive child benefit or a child allowance.
Income Tax Class III
Tax class III offers advantages for married couples if:
- One spouse is not employed or switches to tax class V.
- The spouse lives in an EU country.
- The spouse is widowed – but only in the first year after the partner's death.
Income Tax Class IV
This tax class is for married couples who live together and are both fully taxable. It is particularly suitable if both partners earn a similar income.
- Combination IV/IV: This combination is worthwhile if both spouses earn roughly the same amount.
- Factor method: With tax class IV and factor, allowances are directly included in the monthly income tax calculation. This minimises differences between monthly income tax and the actual tax liability at the end of the year.
Income Tax Class V
This tax class applies to married couples when the partner is classified in tax class III. The condition is that the spouses live together.
Income Tax Class VI
Tax class VI is applied when someone has a second job. This tax class is used for the additional income. People without a valid income tax card from the tax office are also classified in this tax class.
Conclusion: The choice of tax class directly affects the amount of monthly income tax and can facilitate financial planning. Married couples in particular should carefully review their tax class combination to optimise tax benefits.
