Working Life > Child Benefit

Child Benefit

Definition, Explanation

German citizens are entitled to receive child benefit, according to German income tax law. Child benefit is principally granted for every child from birth until completion of its 18th year of age. An extension of the benefit up to completion of the child's 25^th year of age is feasible under certain circumstances.

People who are entitled to receive child benefit:

• All parents of some children, from the child's birth up to completion of its 18th year of age
• The residence of the parent must be in Germany, or the parents are obliged to pay income tax in Germany, with the residence being elsewhere
• The child's net income is below € 8,004 (formerly € 7,680, before 2010) per year, which is the so-called annual income ceiling, or assessment ceiling
• Orphans or children of parents whose whereabouts are unknown, or children of parents who have transferred their title to child benefit to the children
• If at least on 1 day of a month, the prerequisites for child benefit entitlement are fulfilled, the child benefit is given for the whole month
• Foreigners in possession of a valid residence permit or settlement permit certificate and living in Germany
• Citizens of the European Union and of the European Economic Area, even if they do not have a settlement or residence permit, if they live in Germany
• Foreign employees who are obligatorily unemployment-insured or receive unemployment benefit or sick benefit
• Refugees or asylum seekers
• Not: married, full-aged children

Persons considered children are:

• Kin and adopted children
• Children of your spouse as well as your grand children, if you apply for child benefit and they live in your house
• Foster children living in your house when you apply for child benefit

Duration of child benefit given:

• Principally, until a child's 18th year of age completed
• For unemployed children until completion of 20th year of age
• For children in school or apprenticeship or studying in a university, until completion of 25th year of age
• For children having served in military or alternative service, the duration is extended by the duration of the service if the child is studying or in an apprenticeship
• For severely disabled children, having been severely disabled before their 25th year of age, child benefit can be given until both parents of the child have died
• For married children, if the spouse cannot make a living for both
• During a period between two education relationships, e.g. between school and university, child benefit can be given for 4 months

Amount of child benefit (valid from Nov 10 2010):

• For first and second child: each 184 Euros a month
• For third child: 190 Euros a month
• For fourth child and further children: each 215 Euros a month
• The order of counting the children is the order of their birth dates, even if there are included so-called count children for who the applicant is not the one to receive child benefit when they are primarily assigned to another parent

The child benefit is given to the parent in whose house the child lives or who is paying permanemt monetary alimony for the child.

The income of the child comprises all annual earnings and benefits (taxless), as e.g.:

• Earnings from education relationships, including Christmas money and vacation pay
• Profits from capital assets
• Scholarships
• Payment in kind and pocket money received in a voluntary social work year, or voluntary ecological year
• Provision for dependants received
• Provision for dependants as well as employment disability pension received from the statutory pension insurance
• Unemployment benefit, sick benefit, maternity benefit, social money
• Unemployment benefit II
• Complementary BaföG-benefits
• Pensions from the statutory accident insurance
• Employee savings benefits

Not counted as part of the child's income:

• Alimony received from parents
• Child-raising benefit
• Maternity benefit if the child-raising benefit is reduced by a corresponding amount
• Parent money for a grandchild
• Benefits from nursing care insurance

Considered income amount is reduced by:

• Obligatory contributions to statutory social insurance or
• Voluntary contributions to a statutory or private health insurance
• Contributions to nursing care insurance
• Special education expenses, i.e. expenses that count as income-related expenses in case of an employee. Always reduced: the standard income-related expenses amount of € 920. If appropriately certified, even higher amounts can be reduced
• Not: Expenses for board and lodging

As for taxing, received child benefit counts as part of the parents' income. Since a minimum subsistence amount for the children goes untaxed, the exact exempt amount being € 7,008 per child (since Jan 01 2010), the child benefit can remain untaxed as long as the parents' total income is low enough. In a case of high, taxable, income, though, the exempt amount can be higher than the child benefit (evaluation is called Günstigerprüfung) and then no child benefit is given (guillotine effect, Fallbeileffekt). In such a case, the exceeding amount is given.

Payment of child benefit:

• The payment of child benefit is done to an account of the parents or of the child. Children, in order to make sure they get the money directly, can file an application for redirection
• Receivers who work for employers in the public sector receive the child benefit along with their remuneration / wages

Tips, Checklist

• File your application for child benefit at the Familienkasse of the Federal labour agency. Child benefit is granted only on written application. You can hand tha application in, yourself, or send it by post
• Before handing or sending the application, double-check by phone, what documents you have to include
• For certifying your entitlement to child benefit, you can hand birth certificates, written statements on household membership, school certificates, income records, education certificates, disabled IDs, certificates of insurers
• Do not forget to sign the application, noting the date
• For disabled children older than 27 years, you must hand in a valid disabled ID and a doctor's certficate on the start date of the disability
• Report changes of entitling circumstances, e.g. when you move abroad
• If you receive child benefit, you are also entitled to the child additional benefits of Riester-pension and for the home buyers benefit
• As a clerk or an employee in public service remunerated by BAT tariff, you get a locality benefit or family benefit in addition to child benefit
• University students whose parents are receiving child benefit for 3 or more children, do not pay study fees
• Child benefit received without entitlement has to be paid back
• If you are a parent and you are receiving child benefit for one child already, then the one parent who has applied for the former should also apply for any further children's child benefit
• In an application for a further child's child benefit, give the administrative child benefit number of benefits you are already receiving. This shortens the assessment time
• Child benefit for unemployed children between 18 and 21 years of age, the child benefit can be cut if they do not make efforts to find a job
• Child benefit can be given for the past 4 calendar years and for the current calendar year
• For your receiving child benefit, your child's income (e.g. apprenticeship remuneration) must not exceed the assessment ceiling of € 7,680. So, taking into account the standard amount for income-related expenses, the pre-tax income must not be higher than € 8,699 plus paid contributions to statutory social insurance, to be still below the assessment ceiling. When contracting the apprenticeship, pay attention in order to not have the ceiling exceeded by just a little
• Parents whose income suffices for their own needs, and does not for their children's, can receive an additional child benefit of 140 Euros per child per month, in order to not have to receive unemployment benefit II

Last update: 06/17/2010