Has the training allowance been increased in 2023?

Parents who receive child benefit or child allowances for children in school or vocational training are entitled to a training allowance of 924 Euro for "special needs" if the child is over 18 and living away from the parental home (§ 33a para. 2 EStG).

In 2023, the training allowance was increased from 924 Euro to 1.200 Euro (§ 33a para. 2 EStG, amended by the "Annual Tax Act 2022" of 16.12.2022).

The training allowance is reduced by one twelfth for each month in which the conditions are not met for the full calendar month. The training allowance is also reduced if the child lives in a foreign country with a lower standard of living, according to the country group classification by one, two or three quarters.

Has the training allowance been increased in 2023?

When is my adult child's vocational training or school education recognised?

For children over 18 and under 25, you will continue to receive child benefit and tax allowances if your child is in vocational or school education. It is checked monthly whether your child is undergoing vocational training.

The vocational training can take place in Germany or abroad. It does not have to be a measure that is mandatory for a specific profession. It is more about acquiring knowledge and skills that are the basis for the desired profession.

Education includes attending a general school, a university of applied sciences or a university. Child benefit is also available during practical training, such as an apprenticeship or distance learning course. A doctorate following a degree, a traineeship, attending a master school, a language stay abroad or an internship are also considered vocational training. An au pair stay abroad is also considered vocational training if the accompanying language course comprises at least ten hours per week. “Work and Travel” programmes are usually not taken into account.

Practical training or university studies end when the exam result is announced in writing. You are entitled to child benefit for the last time in this month. If your child drops out of training or takes up full-time employment after the exams but before the results are announced, the entitlement ends immediately.

Even if your child works full-time alongside their studies, you are entitled to child benefit if your child is seriously pursuing their degree. The entitlement also applies to children doing voluntary military service.

When is my adult child's vocational training or school education recognised?

Do I retain the right to child benefit if my child cannot find a training place?

If the child does not take up the training place, the effects on the child benefit entitlement are as follows:

• Training efforts: The child is only considered for tax purposes if they are making serious efforts to obtain a training place and can provide evidence of these efforts with appropriate documents.
• Training place not accepted: If the child is offered a training place but does not accept it for personal reasons, the child is generally no longer considered "willing to train". In such cases, the entitlement to child benefit ends at the end of the acceptance period for the training place.
• Postponement of training start: A postponement of the start of training for school, study-related or operational reasons does not affect the assumption of willingness to train. A temporary illness of the child can also justify a postponement.
• Interruption of training due to illness: If the child cannot start training due to illness and the end of the illness is not foreseeable, there is generally no entitlement to child benefit.
• Registering as seeking employment or training: Children must register as seeking employment or training without delay during long waiting periods for a training place or interruptions in training, ideally shortly after the end or interruption of their training. A child seeking employment is considered until the age of 21, a child seeking a training place until the age of 25.
• Consideration during illness: If the child falls ill during their training, the child benefit entitlement usually remains as long as the training service relationship continues during the illness.
• Long-term illness and training: If the illness lasts longer than six months, it is decided on a case-by-case basis whether the training is expected to continue. If not, child benefit is no longer granted.
• Termination of training due to illness: If the training relationship is not only interrupted but terminated due to the child's illness and the illness is not temporary, the entitlement to child benefit ceases. In such cases, consideration as a "child seeking a training place" or "disabled child" may be considered, depending on the circumstances.
• Illness expected to last longer than six months: In such cases, consideration as a "disabled child" may be possible. Under certain conditions, child benefit can also be granted beyond the age of 25.

Certificates and evidence: In many cases, medical certificates or other evidence are required to maintain the child benefit entitlement.

Overall, the effects on the child benefit entitlement depend on various factors, including the reasons for not taking up the training and the duration of the illness. It is advisable to contact the family benefits office early in such cases and provide the necessary evidence to maintain the child benefit entitlement.

Do I retain the right to child benefit if my child cannot find a training place?

How do gaps in training affect my entitlement to child benefit?

There may be up to four full calendar months between two training periods. During this time, you are entitled to child benefit, provided the child is under 25 years old. If they have not started training within this period, you must prove that they have been actively seeking a place, for example, through relevant application letters or rejections and, if applicable, registration at the job centre. In this case, child benefit and allowances can be granted for a longer period.

However, if the transition period lasts longer than four months, for example, if your child travels around the world for six months after finishing school, you will lose your entitlements from the start. The training gap must not exceed four full calendar months, meaning it must end by the month following the fourth month at the latest.

Typical training gaps include the transition period between school and university or the time before or after voluntary service or military service.

Example: Your daughter finishes school on 15 May. She should start training or university by October at the latest, so you as parents can continue to receive child benefit or tax allowances during the transition period.

If your child has confirmation of a training place, child benefit can continue for more than four months. However, this does not apply to voluntary services, as clarified by the Federal Fiscal Court. For example, if your child starts voluntary military service six months after finishing school, child benefit will be stopped immediately. You can avoid this if the child registers as unemployed for the transition period. This works at least until their 21st birthday.

Current decision by the Federal Fiscal Court states that there is no entitlement to child benefit if a child cannot start their training due to illness and the end of the illness is not foreseeable (BFH ruling of 12.11.2020, III R 49/18).

Current decision by the Federal Fiscal Court also states that the termination of voluntary service due to illness leads to the loss of entitlement to child benefit (BFH ruling of 9.9.2020, III R 15/20).

How do gaps in training affect my entitlement to child benefit?

What is the training allowance?

Subject to various conditions, you can claim the training allowance of 1,200 Euro per year (until 2022: 924 Euro) in the "Form Child" without having to provide proof of training costs. For each full calendar month in which the conditions for the allowance are not met, it is reduced by one twelfth. If, for example, your child completed their training in May and then started working, the tax office will grant a training allowance of 500 Euro (1,200 Euro x 5/12).

A temporary interruption of training, e.g. during the transition between two training periods, does not affect the receipt of the allowance. This is the case, for example, during school or university holidays or the transition periods between school and vocational training or university.

In principle, the training allowance is also available if your child lives abroad. However, it may be adjusted to the local cost of living and reduced by one, two, or three quarters depending on the living conditions. For example, if your child attends a boarding school in Switzerland, you can claim the full 1.200 Euro. If they are doing a semester abroad in Mexico, only half of the allowance is available.

What is the training allowance?

When do I receive a training allowance?

For the education of your adult child, you can deduct an allowance of 1,200 Euro per year (until 2022: 924 Euro) from your total income. The following conditions must be met:

• Your child is over 18
• Your child is in school or vocational training
• You are entitled to child benefit or the child allowance for the child
• Your child lives outside your household.

The training allowance is not granted for the whole year, but monthly. This means that for each month in which the above conditions are not met, the training allowance is reduced by one twelfth. The child's income has been irrelevant for the granting of the training allowance since 2012.

You will also receive the training allowance if your child is in a boarding school. If you and your partner are not assessed together, you and your partner are each entitled to half of the training allowance. However, this division can be changed upon joint application by the parents (in the child form).

When do I receive a training allowance?

When is my child accommodated outside my household?

You can only claim the training allowance if your child does not live in your household for a certain period. The duration is not specified, but a six-week internship, for example, is too short.

The decisive factor is the child's independent living arrangements. This is the case if the child lives in their own rented flat or a shared flat. Your child is also considered to be living independently if they

• live in a boarding school or home
• live with relatives
• live in your privately owned flat, which you do not share
• live in a self-contained flat in your house

External accommodation is therefore applicable if the child lives spatially and domestically separate from the parents' household during vocational training, such as in a boarding school, full-day care facility or student shared accommodation during their studies, etc.

For separated or divorced spouses, external accommodation for the child is only applicable if the child lives outside both parental households, i.e. with neither the mother nor the father.

If your child comes home during the holidays, you are still entitled to the training allowance. Visits at weekends or during school or semester holidays are therefore not detrimental.

When is my child accommodated outside my household?