Tax classes 3 and 5 are to be abolished.
In Germany, millions of couples would be affected by the reform.
what that means for her.
Hamm - Which flowers?
Which buffet?
Which party location?
How many guests?
"Yes, I do" is easy to say, but a wedding leads to a whole avalanche of further decisions.
Very unromantic questions such as these also have to be answered around marriage: "Honey, which wage tax class do we take: 3/5, 4 or 4 with a factor?"
If the federal government has its way, married couples or those in a registered partnership will have less choice in the future.
She is currently working on a legislative package that will abolish tax classes 3 and 5 (also: III and V if you like).
Millions of people in North Rhine-Westphalia and throughout Germany are affected by the tax class plans, as reported by wa.de.
Planned end for tax brackets 3 and 5: what that means for couples
Only married couples can choose between different classes, because the income tax class in Germany is primarily based on marital status:
Tax class 1: for single people
Tax class 2: for single parents
Tax class 3: married and a heavy earner
Tax class 4: married and the standard case
Tax bracket 5: married and low earners
Tax class 6: several jobs subject to social security contributions
According to the Federal Statistical Office, most married couples still opt for a combination of tax brackets 3 and 5. What are the effects of their abolition?
And what is all this for?
Income tax class: Combination 3/5 good for different income levels
The tax class basically has an impact on the monthly net income of a couple.
If one partner earns significantly more than the other (rule of thumb: 60 percent and more), the combination 3/5 is favorable.
The lower-earning partner (wage tax class 5) has very high deductions from the gross wage, but this is more than offset by the advantages of the higher earner (tax class 3) at the end of the month.
If both partners earn about the same amount, the tax class combination 4/4 makes the most sense.
The gross-net calculator from Stiftung Warentest shows how the choice of tax class affects income.
Ten tax tricks: How to save money on your tax return
Ten tax tricks: How to save money on your tax return
The bottom line is that both models don't do much, because billing is always done with the income tax return.
Important: By choosing the combination of tax classes, you can only influence the amount of the income tax deduction by the employer, taxes cannot be saved in this way.
If a couple has not made the best choice of wage tax classes, they get less net from the gross each month, but can get it back at the end with their tax return.
Wage tax reform: More net from the gross for second earners
However, the proposed law is not just about numbers, but about social aspects and greater justice.
Because in reality, the lower-earning part of a couple is usually the woman, who is then classified in tax class 5 and disadvantaged by particularly high deductions.
The reform would allow the second earner more net from the gross and - so the hope of family minister Lisa Paus (Greens) - "strengthen economic equality for women".
The traffic light coalition also hopes that by abolishing the 3/5 combination, more women will become employed or increase their working hours.
According to the coalition agreement, the tax class pair III/V should generally be transferred to the tax class 4 factor method that has existed since 2010.
The factor ensures that the wage tax burden is distributed more fairly within a marriage or registered civil partnership.
Everyone pays the share of income tax that they have in the joint income.
With the factor, the tax office already takes the splitting advantage into account during the year.
In concrete terms, this means that the tax office first calculates the anticipated annual income tax liability of the married couple or registered partnership.
This is then divided by 12 months and withheld monthly as income tax.
This should largely avoid additional tax payments.
It is uncertain when the major tax class reform will come.
The legislative package is in progress.
However, some changes in taxes for 2023 have already been made, and employees can look forward to them.
But even retirees have reason to be happy.
From July 2023, millions of pensioners will receive significantly more money - a table shows how much.
List of rubrics: © Patrick Pleul/dpa-Zentralbild/Symbolbild