Munich in English - selected by independent Locals for Cosmopolitans, Newcomers and Residents - since 1989

back to overview

March 1999

Kindergeld -- It pays to have children

Changes in laws that provide families with money for their children.

Kindergeld – It pays to have children Germany’s federal parliament ratified an important change in Kindergeld (payment made to all families with children) at the beginning of the year. Kindergeld for the first and second child was raised from DM 220 to DM 250. Many parents have been receiving the allowance along with their monthly salary through their employer, but as of next year, the money will be paid through the family financial office (Familienkasse) of the employment office. It will be transferred monthly to parents or guardians, providing they inform the family office of their bank account information. To insure an uninterrupted payment of funds, Munich families whose last names begin with A-K should contact the Familienkasse des Arbeitsamtes Deggendorf, 94454 Deggendorf; fax (0991) 310 12 06. Families L-Z should contact the Familienkasse des Arbeitsamtes Passau, 94030 Passau; fax ( 0851) 50 84 40. Other important changes for families are cropping up in tax laws. In response to a married couple’s claim that tax laws gave an advantage to single-parent families, Germany’s constitutional court ruled in January that two-parent families must receive equal treatment. Up to now, single-parent households were granted tax exemptions for child care and housekeeping that were denied to married couples.Currently, the tax exemption (Freibetrag) for children is DM 6,912 per child. Families should receive an additional tax exemption for child-care costs, beginning next year, of at least DM 4,000 annually, whether or not the parents hire a third person to look after the children. Additionally the court ruled that, beginning in 2002, the cost of housekeeping be worth an additional exemption of DM 6,000 annually. The family tax breaks are estimated to cost the German government a crippling DM 22.5 billion loss in annual revenue.

tell a friend