Parental allowance (Elterngeld) in Germany: who qualifies, how it is calculated and when to apply
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Parental allowance (Elterngeld) replaces part of the income a family loses when one or both parents stop or reduce work to care for a newborn. It is one of the most important benefits for young families in Germany, but many lose part of it by applying late or not understanding how it is calculated.
Who qualifies?
Generally, anyone living in Germany with their child in the same household, caring for the child themselves, and not working more than a set number of hours a week during the benefit period. For non-EU citizens the law requires certain residence permits: holders of a settlement permit and most work permits qualify, while some temporary permits for specific purposes are excluded. There is also an upper limit of taxable income above which there is no entitlement. Check your situation on the official portal before the birth.
How is it calculated?
As a general rule the allowance is 65% to 67% of your average net income in the 12 months before the birth, with a minimum of 300 euros and a maximum of 1,800 euros a month for basic Elterngeld. People with no income receive the minimum. Because the calculation uses net income, your tax class in the months before the birth affects the amount, which is why some couples change class early, as long as the change is made in good time before the birth as the law requires.
Basic Elterngeld or ElterngeldPlus?
Basic parental allowance (Basiselterngeld) is usually paid for up to 12 months to one parent, extended to 14 months if the other parent takes at least two months. ElterngeldPlus pays half the monthly amount for twice as long and suits parents returning to part-time work. You can combine both types and split the months between parents in different ways, so plan the split before applying.
When to apply
You apply after the birth at the parental allowance office (Elterngeldstelle) in your federal state; many states allow online applications. The key point: the allowance is only paid retroactively for the three months before the month you apply. Delay means losing months of allowance for good. Prepare the documents before the birth: payslips, the birth certificate issued by the registry office after the birth, and your health insurer’s statement on maternity benefit.
A note on tax
Parental allowance is tax-free, but it is taken into account when calculating the tax rate on the family’s other income. If such benefits exceed 410 euros in the year, filing a tax return becomes mandatory and you may have to pay a small difference. Know this in advance so you are not surprised.
This article is general information, not legal or tax advice. Laws change, so check the official sources below or the competent authority for your situation. Found a mistake? Tell us.