Parental allowance and tax bracket
Parental allowance is paid for one or two parents after the birth of a child over a period of just over two years. How the parental allowance is divided between the two parents and within the time can be designed very differently. The amount of the parental benefit is 67% of the net income in the last 12 months before birth.
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What exactly is parental allowance??
Parental allowance is a substitute for the state. It is intended to compensate for a loss of salary after birth due to the care of one’s own children. A parent can receive a parental allowance of at least two and a maximum of 12 months. If the other partner also participates in the care, the parental allowance can be claimed for an additional two months (maximum 14 months). These additional months of parental allowance are also known as partner months. Single parents can receive parental allowance for a maximum of 14 months.
Parental allowance and tax bracket – this is how they relate
It is important for all expectant parents to know that the parental allowance is calculated from the previous net income. A low net income (based on the calculation with flat-rate deductions from gross income) therefore results in a low parental allowance. A higher income, on the other hand, brings a higher parental allowance.
At this point there is also a connection between Parental allowance and tax bracket. It is worthwhile if the partner who receives parental allowance after birth changes to tax class 3. Lower deductions are expected there and there is more net of gross. For the period before the birth, the tax situation for the couple as a whole is less favorable. However, this disadvantage can be offset by the tax return and the higher parental allowance.
- The calculated parental allowance net income is not the same as the normal net income on the pay slip.
How much can the parental allowance be??
The amount of the parental allowance is usually between 65 percent and 67 percent of the net income.
|Previous income||Replacement rate of parental allowance|
|1,000 – 1,200 euros||67 percent|
|1,220 – 1,240 euros||66 percent|
|from 1,240 euros||65 percent|
|less than 1,000 euros||67 percent to gradually 100 percent|
- Minimum rate: 300 euros / month
- Maximum rate: 1,800 euros / month
- Other children influence the amount of the parental allowance. So there is the sibling bonus, which makes up 10 percent of the parental allowance, but at least 75 euros, and in the case of multiple births, the multiple allowance of 300 euros for each additional child.
What is Parental Allowance Plus??
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