How do I have allowances or changes entered on my employment tax card?
Excessive taxes are often withheld during monthly payroll tax deductions. However, if you have high work-related expenses, special expenses, or extraordinary burdens, you don't have to wait until the end of the year to receive a tax refund. By applying for a payroll tax reduction, you can have these expenses entered as payroll tax allowances during the year. This increases your net salary month by month.
How does the application for a payroll tax reduction work?
With an application for a payroll tax reduction, allowances can be entered directly in the electronic payroll tax deduction features (ELStAM). This means your employer withholds less payroll tax each month. The application can be conveniently submitted to the tax office.
Forms and simplifications
The previously 6-page application form has been replaced by a main form and special annex forms. These annex forms (e.g. for children, work-related expenses, or special expenses) only need to be completed if required.
In many cases, the 2-page “simplified application for payroll tax reduction” is sufficient. This is the case if:
- the requested allowance is not higher than in the previous year, or
- only the number of child allowances has changed, for example due to the birth of a child or for children in vocational training after the age of 18.
Renewal of an existing allowance
If an application was submitted in the previous year and the tax allowances have not changed, it is sufficient to fill in the personal details and the section “payroll tax reduction in the simplified procedure” in the new main form.
Which expenses can be taken into account?
A payroll tax reduction can be applied for the following expenses:
- Work-related expenses: Only considered if they exceed 1.000 Euro (102 Euro for pensioners).
- Special expenses: Amounts exceeding the special expenses allowance of 36 Euro (72 Euro for spouses) are taken into account.
- Extraordinary burdens: For example, medical expenses or care costs.
- Relief amount for single parents: Applies to widowed or separated single parents.
The expenses must total more than 600 Euro in the calendar year to apply for a payroll tax reduction.
Important notes
Disabled persons and bereaved individuals can apply for allowances without exceeding the application limit of 600 Euro. The application for a payroll tax reduction is particularly advantageous to create financial leeway during the year.
Here you will find the most important application forms.
