The mutual sentiment of every solidary and pro-family tax policy lies in tax deductions. They serve as a social corrective of the state. Namely, a person who has 3 minor children certainly has higher necessary monthly living costs than a person who has no dependent members – therefore the state mandates that this person, in the same job (i.e., same Gross 1 contract), be taxed on a SMALLER (lower/reduced) amount in order to receive a larger and higher Net amount for payment to the account.
Dependent members (or shorter: deductions) are formal tax designations of your household members, family members, or relatives (often: dependent children, disabled spouse, or persons with disability statuses according to law tables) whose official personal needs are considered dependent on the income (earnings and profit) of the taxpayer, i.e., the employee and worker who feeds them. These members are entered and recorded in the public tax status on the so-called "Tax Card - PK" Form within the Pension-Health state information system of the listed tax administration branch.
The amount of these personal (tax-free dependent additions and bonuses) grows and is influenced by the prescribed deduction coefficient that multiplies the concept of base Deduction and grows with geometric dynamics (proportionally) – family pro-natalist support (the second child carries a stronger deduction than the first).
| Category | Monthly Tax-free "Excess" Addition in Euros |
|---|---|
| Dependent member of immediate family (e.g., spouse) | 300,00 EUR (Faktor 0.50) |
| For the first child in the family | 300,00 EUR (Faktor 0.50) |
| For the second child | 420,00 EUR (Faktor 0.70) |
| For the third child | 600,00 EUR (Faktor 1.00) |
| All added children after the 4th child (and beyond) grow each higher jump added geometrically exponentially with a higher factor in the plus calculation... | |
If your reported child "sits on the tax deduction" on your tax PK work card (as a factor for you), it is important to know that the child in that year, if they get seasonal part-time employment in the summer or as a student (worker traveler artisan) earns income BIGGER or a higher amount than the state-set limit of total acquisitions at the level of the entire year (e.g., receipt limit approx. 3,360 EUR sum in HR), then you retroactively lose all acquired right and dependent legal exemptive deductions through that entire past year!. At the end of the calendar spring application for return of excessive income levies to the Tax Administration – you will pay a punitive excess calculation return of debt in favor of the state budget – so-called debt application by form DZZ-1! Take extreme care and warn the family.