The Wages and the Taxes For You

The gross wage can be entered as an annual gross wage or on the basis of a month, a week or a day. The amounts that are deducted or added to wages in the form below are to be related to the period selected here.

About the Pension Payments

Pension payments are payments and benefits from an earlier employment relationship due to reaching an age limit or reduced earning capacity and survivors’ payments. The pension payments also include widow’s and orphan’s benefits, pensions, maintenance contributions or similar payments based on civil servant law or corresponding statutory provisions. These pensions are to be recorded separately, as some of them are tax-privileged. If pension payments are specified, further information is required to determine the pension allowance and the supplement to the pension allowance.

  • If the pension payment begins in the current calendar year, the number of months for which the pension payments are paid must be specified accordingly.
  • The year in which pension payments are granted for the first time determines the relevant percentage and the respective maximum amounts of the pension allowance and the supplement to the pension allowance.
  • Twelve times the pension in the first full month of the pension is the assessment basis for the pension allowance. In the case of pension payments that began before 2005, twelve times the pension payments in January 2020 are decisive.

Pension expenses are taken into account in the wage tax deduction procedure via the pension lump sum. The following information is required to calculate the flat rate pension.

Pension insurance: 

State whether the employee is compulsorily insured in the statutory pension insurance. Compulsory insurance can also be assumed if there is an exemption from statutory pension insurance and insurance in a professional pension institution (Section 6 (1) No. 1 SGB VI). The respective income threshold (general income threshold BBG West or income threshold east BBG East) is taken into account through the corresponding selection.

If no employee contribution to the statutory pension insurance is to be paid, the entry “no statutory pension insurance” should be selected. This is the case, for example, with officials. The income tax calculator is important for such results.

Company pensioners

marginally employed persons who are exempt from the increase to the regular contribution rate for general pension insurance and retired pensioners in employment.

Health insurance: “Statutory health insurance” is to be selected if the employee is compulsorily or voluntarily insured in statutory health insurance. In addition, no further expenses for ( possibly supplementary) private health / long-term care insurance can be taken into account.

For example, privately insured civil servants have “private health insurance without employer subsidies”.

A “private health insurance with employer subsidy” exists, for example , if an employee is not subject to compulsory insurance and is privately insured in the statutory health insurance due to the annual income limit being exceeded. The employer’s allowance due to these employees is taken into account in a standardized form when deducting income tax.

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