Changes from January 2023: What's new with child benefit, pension and housing benefit?

Created: 01/01/2023 18:32

By: Mark Stoffers

With the turn of the year, legal changes and new laws will come into force from January 2023.

What's new and what's changing this month?

Berlin – New year, new happiness?

The legal changes for 2023 will start in January.

Various laws are important as changes from January 2023 for consumers in Germany.

Among other things, one of the biggest issues is the successor to Hartz IV: citizen income.

The increases in child benefit, housing benefit and pensions have caused far fewer political discussions, and yet the legal changes from January 2023 are no less important for citizens.

But which new laws and regulations actually apply to citizens and what influence do they have on daily life?

Changes in January 2023: citizen income is coming – amounts will be increased by around 50 euros

It is known that the government had been planning the successor to Hartz IV for a long time.

The former system, which had existed since 2005, was abolished in the new year.

That is why citizen income is one of the most important changes from January 2023. Thanks to the new basic income, recipients will have more money in their pockets in the future.

Because the basic security increases with the first payment of the citizen's income to 502 euros per month.

Thus, the amount increases compared to Hartz IV by more than 50 euros for recipients.

At the same time, there was an adjustment to the allowance for savings.

This is a protected amount of 15,000 euros, which is not adjusted to the entitlement to citizen income.

Furthermore, the job centers will increasingly take care of the unemployed in the future.

This is intended to ensure that long-term employment occurs during mediation and that recipients of citizen's income do not just fall into temporary jobs in the future.

Legal changes from January 2023: Increase in child benefit - adjustment of the child allowance

The legal changes from January 2023 include child benefit in addition to citizen benefit.

Thus, the new year begins with good news for all parents, as child benefit has been undergoing a significant change for around 30 years from January 2023 with the sharp increase.

The new regulation increases child benefit to 250 euros per month per child.

This corresponds to an increase of 31 euros for the first and second child, while there will be 25 euros more per month for the third child in future.

There is even more good news for parents.

Because the child allowance will also change from January 2023. This will be adjusted and will increase from 5,620 euros in 2022 to a total of 5,760 euros in 2023.

What's new?

From January 2023 there will be a change in housing benefit - millions of people will be affected

Also new is a change in housing benefit from January 2023. From this year onwards, more households will be able to benefit from housing benefit, which will also receive an increase.

So far, only about 600,000 households have received statutory subsidy.

What is new from January 2023 is that 1.4 million new households can calculate a chance of housing benefit.

The condition for applying for housing benefit is then no longer that beneficiaries have to receive social benefits.

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Instead, other low-income households that have little money at their disposal but still do not receive social benefits can apply for the rent subsidy.

Instead of the original 190 euros, low-income tenants will receive a substantial increase and can expect around 370 euros a month with the new regulation from January 2023.

The adjustment is part of the housing benefit reform, which was implemented partly because of the rise in energy costs.

Legal changes from January 2023

• What will change from January 1, 2023

• Citizen's income replaces Hartz IV

• increase in child benefit

• increase in housing benefit

• There is no additional earnings limit for the pension

• Pension contributions are tax deductible

• Energy flat rate for students

• Possible change in 2023 at Netflix: streaming service probably prohibits password sharing

• Modifications for photovoltaic systems

• Legal change for landlords, owners and tenants in the climate tax

• Deadline extension for property tax

• Change in MIdi jobs

• increase in the basic allowance

• Increase in the top tax rate

Changes in 2023 for pensioners: more money and tax relief from January - additional income limit falls

Pensioners can also look forward to good news with the changes in 2023.

Because new regulations will come into force from January: On the one hand, the additional earnings limit will fall from January 2023, which means for early retirees that they can earn any amount of money in a part-time job without having to worry about pension cuts.

January brings some legal changes in Germany.

In addition to the increase in child benefit and the introduction of citizen benefit, there will be tax relief for pensioners and all citizens © IMAGO / Lobeca

On the other hand, the additional earnings limit is raised for disability pensions.

At the turn of the year, pensioners can earn up to EUR 35,650 with a partial reduction in earning capacity, with a full reduction in earning capacity the limit is set at EUR 17,820.

In addition, a table shows that pensioners can look forward to a “noticeable increase” in their pension in 2023, as well as a tax relief on income tax.

Because the pension contributions are now completely tax-deductible from January.

They count as expenses for old-age provision.

In the course of 2023, even more pension changes will come into force.

Changes from January 2023: Energy flat rate for students - Netflix gets serious about password sharing

After the majority of pensioners in Germany received the energy lump sum of 300 euros in December 2022, it could be the turn of students in January to pay out the energy lump sum.

"The payment should begin at the beginning of next year, i.e. this winter," says the Federal Ministry of Education and Research.

If you are enrolled at a university or technical school, you will receive a one-off payment of 200 euros from the state to cover the increased energy costs.

Netflix may also have made a change from January 2023.

The streaming service has announced that it wants to ban password sharing.

The ban on sharing an account with people outside of your own household is intended to prevent series and film viewing that is virtually free of charge.

So far, however, Netflix has only announced that it will do this, but whether the change will really take place in January is still in the stars.

Legal changes in 2023 for photovoltaic systems and the climate tax

Owners of solar systems can be particularly happy.

Because the changes from January 2023 include simplifications for photovoltaic systems.

Among other things, there is no longer any obligation to install a special generator electricity meter.

While some new rules from the Renewable Energy Sources Act have been in effect since 2022, smaller solar systems with an output of up to 30 kilowatts can be operated tax-free on residential buildings from January.

Photovoltaic systems with up to 15 kilowatts, which are mainly used in buildings used for operational purposes, also benefit.

From January 2023, there will also be an important change for landlords, tenants and owners in the climate tax for heating: from January in many cases landlords will have to contribute to their tenants’ climate tax for heating.

The so-called CO₂ price is divided between tenants and landlords according to a tiered model.

The less climate-friendly the house is, the more the landlord has to take on.

So far, tenants have had to pay the levy, which is intended to help reduce climate-damaging carbon dioxide emissions.

Legal changes from January 2023: What's new in property tax returns, home office flat rate and midi jobs

Another change in 2023 provides that house and apartment owners must submit their property tax returns by the end of January.

The original deadline was the end of October.

Because of the slow entrance it was lengthened.

If the deadline for the property tax return expires, there is a risk of severe fines.

For so-called midi jobs, the earnings limit will increase from January 2023. Employees who fall into this group are now able to earn EUR 2,000 instead of EUR 1,600.

In addition, until this new change is made, employees will have to pay lower social security contributions.

Even with the home office flat rate, an increase from January 2023 will already shift the limits on the tax return for the corresponding period.

Because instead of 600, up to 1260 euros can now be applied to the tax return.

The lump sum is included in the income-related expenses, for which all taxpayers are charged 1,200 euros anyway.

That's why only those who get over this amount with a home office flat rate and other expenses benefit.

Tax changes from January 2023: New regulations for the basic allowance and top tax rate

From 2023, employees will also be relieved of tax with not just one change: As part of the Inflation Compensation Act, the federal government decided to increase the basic tax-free allowance from January 2023.

Accordingly, the basic allowance increases from previously 10,347 euros to 10,623 euros.

With this new regulation, the subsistence level is to be secured in the current precarious economic situation in the new year.

Another tax change in January 2023 will occur as part of the adjustment of the basic tax-free allowance.

Because the top tax rate is subject to a new regulation.

Because in 2022 it was still 42 percent, but from 2023 this will only be applied with an even higher income.

The limit of the top tax rate was raised from EUR 58,597 to EUR 61,972 per year at the turn of the year.

However, there is no change in the tax rate for the wealthy, which applies from an income of 277,836 euros.

In contrast to the many changes in January 2023, everything will remain the same even after the turn of the year.