Moving to Germany for work: how your salary is taxed

How your salary is taxed

• Wage tax (Lohnsteuer) is withheld every month. It follows the income tax scale: nothing on the first €12,348 of taxable income, then rates rising from 14% to 42%, and 45% on very high incomes.
• Solidarity surcharge: 5.5% of the wage tax, only once your yearly tax is above €20,350 as a single person, so most employees do not pay it.
• Church tax: 9% of the wage tax, or 8% in Bavaria and Baden-Württemberg, only if you are registered as a member of a church that collects it. On €60,000 it costs €845 a year.
• Social insurance: you pay 9.3% for pension, 1.3% for unemployment, 7.3% plus half your health fund's additional contribution for health, and 1.8% for care (2.4% if you are 23 or over and have no children). Your employer pays about the same again on top.

Worked example: €60,000 a year

Take-home pay at common salaries

No church tax, no children, statutory health insurance at the average rate.

Your tax class

Single people are in class I. Married couples and registered partners who both live in Germany choose between III/V, which suits couples where one partner earns much more, and IV/IV. The class only changes how much is withheld each month; married couples are assessed together after the year ends. On €60,000 the classes compare like this:

If your spouse still lives abroad, you are normally in class I. If you are an EU or EEA citizen, your spouse lives in the EU, the EEA or Switzerland and almost all your joint income is taxable in Germany, you can apply for class III, and you then have to file a tax return. Tax classes explained.

Your first payslips

You must register your address (Anmeldung) within two weeks of moving in. The Federal Central Tax Office then sends your tax ID by post; there is no fixed processing time. Your employer needs the tax ID and your date of birth to fetch your tax class and other details electronically.

Church tax

Whether you pay church tax depends on the religion you give when you register your address. If you are a member of the Catholic or Protestant church, say so, because it is collected through your payslip. If you have left your church, or are not a member, make sure your registration says so. To leave a church in Germany you make a formal declaration, at the local court in some states (for example Berlin and North Rhine-Westphalia) and at the registry office in others (for example Bavaria); church tax normally stops at the end of that month.

Tax residence

You are fully taxable in Germany if you have a home there or stay for more than six months, counted from your first day. In the year you arrive, your German salary is taxed in Germany, and income you earned abroad earlier that year can still raise the rate on your German income. That is why a tax return is often required in your first year.

Health insurance

Statutory health insurance is compulsory unless you earn more than €77,400 a year (2026). Above that you can choose private insurance, and your employer pays a subsidy of up to €508.59 a month. Statutory insurance covers your spouse and children free if their own income is low. Our calculator assumes statutory insurance.

First steps after you arrive

1. Register your address (Anmeldung) within two weeks, and state your religion correctly.
2. Wait for your tax ID by post and give it to your employer with your date of birth.
3. Choose a health fund (Krankenkasse), or private insurance if you earn above the threshold.
4. Check your first payslips: tax class, church tax and the health fund's additional contribution.
5. Apply for child benefit (Kindergeld, €259 a month per child in 2026) at the family benefits office if your children live with you.

Your tax return

Employees with one job in class I often do not have to file, but you must if, for example, you were in class III/V or IV with a factor, had two jobs at the same time, had a tax-free allowance entered, or had more than €410 of income that only raises your tax rate, such as foreign salary earned before you moved. Returns for 2025 without a tax adviser were due by 31 July 2026. You can file voluntarily for up to four years: returns for 2022 must be filed by 31 December 2026.

What changes in 2027

A draft Income Tax Reform Act 2027 would raise the tax-free allowance to €12,564, child benefit to €267 a month and add a 47% rate above €280,000 of taxable income, but it is still being debated. The cabinet has agreed higher contribution ceilings for 2027, pending the Bundesrat, and the minimum wage rises to €14.60 an hour. We will update the calculator once the 2027 payroll formula is published.

Sources

• BMF: Programmablaufplan for the machine calculation of wage tax 2026 (letter of 12 November 2025)
• § 1 EStG and §§ 8–9 AO: tax residence
• § 17 Federal Registration Act: registering within two weeks
• Federal Central Tax Office: tax ID
• § 39c EStG: payroll without tax details
• § 1a EStG: EU/EEA spouses
• § 46 EStG: when employees must file
• BZSt: church tax rates (8% in Bavaria and Baden-Württemberg, 9% elsewhere)
• Deutsche Rentenversicherung: figures and tables 2026
• Federal Ministry of Health: private health insurance
• Deutsche Rentenversicherung: refund of contributions
• Federal Employment Agency: child benefit 2026
• Bundestag printed paper 21/8235: draft Income Tax Reform Act 2027
• Our methodology and the full list of sources for the calculator

Frequently asked questions

This guide explains the general rules for employees and is not personal tax advice. Rules change and individual situations differ, so check with the tax authority or a tax adviser before making decisions. Spotted something out of date? Email [email protected].