Wages and Incidental Costs | HEUSER RECHT UND STEUERN
www.heuser.de • 05
Electronical Wage
Tax Card
Since some years, every resident in
Germany receives a Tax Identification
Number (Steueridentifikationsnummer).
German-born people get this ID by
letter already short after birth, whereas
foreigners are assigned with this
identification number as soon as they
register their residence in Germany. The
Tax Identification Number gives access
to the electronic wage tax card, which
contains all relevant data to evaluate the
exact amount the employer has to deduct
from the employee’s income to pay the
income tax. It includes: tax class, marital
status and the number of children.
Annex Taxes
So-called annex taxes are
tax rates which are calculated
based on another tax rate.
In Germany, the solidarity
surcharge and the church
tax base on the income tax
rate.
Currently, the solidarity surcharge
amounts to 5,5% of the payable
income tax - it is, however, not levied
if the income tax is lower than €81
per month (€162/month for jointly
filed couples). 2021, this threshold
will be increased massively so that
most employees will no more be
obliged to pay this tax.
Church tax is also an annex tax
and is to be paid only by members
of officially recognized religious
communities. It amounts to 8-9%.
Both annex taxes have to be deducted
from the employee’s income and
forwarded by the employer.