Basic Tax-Free Allowance (Grundfreibetrag) in 2025

Ivan Relja

03.01.2025

– Update:

03.01.2025

Good to know

• Almost every year, the basic tax-free allowance is rising

Content

• What is a Basic Tax-Free Allowance (Grundfreibetrag)?
• Basic Tax-Free Allowances for 2025 and Previous Years
• The Children’s Tax-Free Allowance and Single Parents

What is a Basic Tax-Free Allowance (Grundfreibetrag)?

The basic tax-free allowance (Grundfreibetrag) in Germany is an income amount that can’t be taxable. This is an amount that is enough for essential life. So, only income higher than the basic tax-free allowance is subject to income tax.

Every two years, the German federal government must determine the amount of basic tax-free allowance.

Every taxpayer is entitled to this annual basic tax-free allowance.

Basic Tax-Free Allowances for 2025 and Previous Years

German basic Tax-Free Allowances valid in 2025 are 12,096 € for single and 24,192 € for couples.

Income tax is calculated for each assessment period according to the rules described in Section 32a of the Income Tax Tariff – Income Tax Act (EStG).

The basic tax-free allowance stated in the table below is adjusted annually and applies per capita. The basic tax-free allowance for couples is twice as high as for single people.

The Children’s Tax-Free Allowance and Single Parents

In addition to the basic tax-free allowance (Grundfreibetrag), each child is taken into account either through child benefit (Kindergeld) or the children’s tax-free allowance (Kinderfreibetrag). In the current year, parents will initially receive child benefits (Kindergeld). When submitting a tax return, the tax office automatically carries out a favorable check. They determine whether the tax advantage resulting from the children’s tax-free allowance is higher than the child benefit paid out. If the tax advantage is lower, the child benefit remains. Single parents receive an additional relief amount of children’s tax-free allowance.

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