(2023) Save with a tax allowance in the ELStAM!

If you have high income-related expenses, special expenses, or losses from other types of income (e.g. rental, business, capital assets, etc.), you pay too much income tax from your salary every month.

Only when you complete your income tax return can you reclaim the overpaid income tax from the tax office.

With an application for income tax reduction, you can have the tax office enter an allowance for various tax deductions and your anticipated expenses in the electronic income tax deduction features (ELStAM). During payroll processing, your employer will then reduce your gross salary by the monthly allowance. As a result, income tax is only calculated on the reduced gross salary. This means you pay less tax, solidarity surcharge, and church tax during the year with an allowance.