(2022)
How to obtain an additional allowance for the second child!
The tax relief for single parents had been increased to 1.908 Euro for years. Additionally, 240 Euro is added for the second and each additional child in the household (§ 24b EStG).
The closure of nurseries and schools during the coronavirus pandemic posed significant challenges for all families, particularly for single mothers and fathers. In 2020, the relief amount was increased from 1.908 Euro to 4.008 Euro, more than doubling it. The increase of 240 Euro remains unchanged (§ 24b para. 2 sentence 3 EStG, amended by the "Second Coronavirus Tax Assistance Act").
But what do you need to do?
The relief amount and the new increase are reduced by one twelfth for each full calendar month in which the conditions are not met. The relief amounts are applied for as part of the tax return in the "Form Kind". For employees, both amounts can already be taken into account during the year in the monthly wage tax deduction, leading to a lower deduction of income tax, solidarity surcharge, and church tax.
- The (basic) relief amount is taken into account by simply applying for tax class II at the tax office. The relief amount is included in the income tax table. However, only one child is considered. When applying, the tax office requires a declaration of your status, which you submit using the form Declaration for the application for tax class II (PDF).
- For the new increase of 240 Euro from the second child, you need to do a bit more: You must have a tax allowance entered in the electronic wage tax deduction features (ELStAM) at the tax office (§ 39a para. 1 no. 4a EStG). This allowance is distributed over the remaining months of the year from the month of application; it must be applied for by 30 November of the relevant tax year at the latest. The employer accesses the database, takes the monthly allowance into account, and withholds less income tax from the wages accordingly. The usual application limit of 600 Euro does not apply for the application for the allowance (§ 39a para. 2 sentence 4 EStG). For the application to consider the increase, use the form Simplified application for income tax reduction.
Since 2016, the applied-for income tax allowance is valid for a period of two calendar years (§ 39a para. 1 sentence 3 EStG). If your circumstances change to your disadvantage within the two years, you are obliged to have the allowance changed. This may be the case if you marry or move in with a partner. If you apply for an income tax allowance, you are obliged to submit an income tax return after the end of the tax year (§ 46 para. 2 no. 4 EStG). If the relief and increase were not taken into account in the wage tax deduction, both amounts can also be applied for with the income tax return.
The Federal Fiscal Court has recently ruled that jointly assessed spouses can also claim the tax relief for single parents in the year of marriage on a pro rata basis, provided they did not live in a household with another adult before the marriage (BFH ruling of 28.10.2021, III R 57/20).
The Federal Fiscal Court has also recently ruled that in the year of separation, the relief amount is to be granted on a pro rata basis for the months after the separation if individual assessment is chosen and no other adult lives in the household (BFH ruling of 28.10.2021, III R 17/20). Note: The ruling states: "Taxpayers who are individually assessed for income tax as spouses under §§ 26, 26a EStG can claim the tax relief for single parents on a pro rata basis in the year of separation...". From this, it can be concluded that the pro rata granting is only possible if individual assessment is chosen. However, looking at the BFH ruling III R 57/20 of the same day (see above), it can be inferred that the pro rata relief amount is also to be granted if joint assessment is chosen in the year of separation. It would have been desirable for the BFH to have expressed this more clearly.
