Many parents already know them from their own experience: the family fund. It is a federal financial authority of the Federal Republic of Germany and is responsible for the approval and payment of child benefit and child allowance. 14 family funds, each with a fixed regional responsibility and numerous offices nationwide, allow the child benefit provided to be paid to the beneficiaries.
Family fund – structure and function
At the federal level, the federal financial authorities represent the body of the financial administration. They include the family funds, which in turn are assigned to the Federal Employment Agency. The family fund is the institution responsible for carrying out the family benefits equalization. This term means services that families can take advantage of to compensate for the additional work for children. These benefits have to benefit the children, they have to be used for maintenance and training. Family allowances include tax relief (child allowances) and child benefit and child allowance.
14 family funds ensure that all beneficiaries can take advantage of these benefits. With a total of over 39 billion euros, amounts were paid to around 17 million children in 2016. The family funds of the Federal Employment Agency are responsible for around 87% of all child benefit applications. The family funds of public employers are responsible for the other 13%. This is the case if the parents or parents of the children for whom benefits are requested are employed in the public service. These applications are currently being processed by approximately 5,500 family coffers – in each case the body concerned with determining the salary – for public employers.
In order to streamline the complicated workload, a reform was decided on December 8, 2016. According to the new regulation, until December 31, 2021 the responsibility of the family funds for public service in the federal area will pass to the area of responsibility of the Federal Employment Agency, alternatively the Federal Administrative Office will be the competent authority. If the state and local authorities are currently responsible, the employers of the public service can also submit child benefit applications to the BA. Countries and municipalities are then relieved of the administrative costs.
Benefits and payment of the family benefits
Child benefit and child allowance are the two benefits that directly entitled parents and single parents receive for their children. While the child benefit is paid to all parents regardless of their income – and since 2012 also regardless of the income of the adult child – the child supplement is a benefit for a certain group of people. This additional cash benefit is given to parents and single parents whose gross income exceeds 900 euros (parent pairs) and 600 euros (single parents). At the same time, however, the applicable maximum income and wealth limits must not be exceeded. The maximum income limit is calculated individually for each family. The prerequisite for payment of the child supplement is that there is a right to child benefit.
The family fund reviews the applications with regard to the requirements, the information and the required documents. It calculates the amount of the child supplement. One of the basic requirements is that parents or legal guardians are resident in Germany. If this is not available, there must at least be an unrestricted tax liability in the FRG. Special regulations apply to foreigners under the Federal Child Benefits Act. The Family Benefits Office is the point of contact for all beneficiaries when it comes to questions about the payment or continued payment of child benefit and child supplements.
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