Monday, 17 February 2014

Rant No. 17: Tax.

When I first moved to Berlin I was under the mistaken impression that I would be rich. The rent was so cheap, and my salary was good by a Berlin standard,  such that I would have plenty of disposable income.

Sadly, this was not the case. When I received my first pay check I was shocked by what was inside. My take-home salary was almost half my actual salary! The tax was about 40%.

I spoke to HR, who informed me that despite my relatively junior salary, I was in the highest tax bracket. Why? Because I was single and didn’t have children!

Can you believe that? I had to pay more because I was not married. I was incensed. So not only did my bosses earn so much more money than me, but because they all had wives and children, then they also paid a hell of a lot less tax. Great!

What a system I thought. I am basically penalised for not having a family. What if I never wanted to get married or have children? I’d be stumped with the highest tax bracket for life.

As everything was in German bureaucratic terminology, it took a while to translate and figure out where all my money was going. The nitty gritty of all the things I pay tax for. Old age tax. Now, this is not the same as a pension, which I pay into to, but a tax to provide for being in my old age. What if I don’t plan to be here when I’m old? Doesn’t matter! There’s also unemployment tax, another tax that I will probably never use. The only tax that you can actually opt out of is the church tax, which I don’t pay, because I’m not religious.

Really, I found this all incredible. In hindsight, I was a bit naïve, as having never worked abroad before, it hadn’t occurred to me to check the tax. Luckily, I’m married now (not for the tax, though I’ve heard that many Germans do make this decision), and so I’m no longer in the highest tax bracket.


  1. When I went to get my Lohnsteuerkarte I was a doe-eyed innocent and when they asked me my religion I said Catholic thinking it was a demographic question. The only way they will let me get out of Kirchensteuer is if I manage to get ex-communicated by the Pope. I think that's quite hard to do.

  2. OK, so it is true that you get taxed less if you're married - but only ONE of the spouses gets to take that tax bracket. The other is still taxed at 40%. AFAIK children have nothing to do with the tax, although you do get to apply for money. But you pay extra from your salary for health insurance to include them. I know the grass always looks greener on the other side, but as a spouse of someone here who wishes she could work, it's insane to think that until I make Netto at least 1500-1600 euros per month there is no reason for me to work. And I WANT to work!

  3. It is hardly the state's fault if you are not sure if you are going to be here when you are old, what if you are? Unemployment can happen to any of us, it is worth being protected. How do you think social welfare should be paid? That 40% covered my health insurance too so I felt I got a hell of a lot more for the taxes paid in Germany than in the country I now live in where I pay less tax but a lot more for health insurance, private pensions and have no pretection against unemployment etc. Its all relative. Of course for people who are very healthy all their lives and never lose a job these payments can seem unfair but nearly all of us know someone who has had to avail of these "taxes". I also managed to get quite a bit of money back for pensions etc when I left Germany (obviously not taxes but the versicherungen) - worth looking into if you do leave at any time - now the whole married, single tax stuff is something that I could really rant about! I do believe that people with kids deserve some extra support but am sick of being penalised for being childless and unmarried (even tho I have been in a relationship for 20 odd years!) and the situation in Germany is appalling and ultimately has sexist patriarchal roots

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  5. Transferring to a different country means yielding to its implemented taxes – which could be a big adjustment for some. I can only imagine how frustrated you were with regard to this encounter, and it does take a bit of getting used to. Anyway, it’s nice to know that you manage to get through it. Thanks for sharing this with us.

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