Last Updated on January 7, 2025
The traditional column: how much more we will pay in the coming year. The main changes occurred in the previous reporting period, so in 2025, we will primarily be dealing with letting the dust settle.
Let’s start with the good news. We will still get something, but the amounts are small and completely eaten up by the price increase.
Part 2. What’s new in Germany 2025. Consumption
All finance posts: #finance
New pleasant things in finance in 2025
More money after taxes
The tax-exempt income base has been increased (by as much as €300), along with the child deduction (by €60).
More money for parents
Kindergeld is a whopping 5 euros more per month per child (255 euros).
Increasing the minimum wage
The minimum wage per hour is increasing by 41 cents. The Minijob limit is increasing accordingly to 556 euros.
The hourly rate has also increased in various sectors with a tariff payment system. This particularly affects workers in the Pflege and construction industry.
And other small increases for the benefit of the population
Wohngeld is increased by 30 euros.
Plus 5 euros in Kindersofortzuschlag for low-income earners or those on welfare.
Increase by 30-60 euros in the amounts paid to those in need of care.
Small amounts more for Azubi.
Vocational training in Germany – looking for Ausbildung
The increase in the allowable earnings limit for those receiving disability or incapacity benefits.
Increasing pensions in accordance with the growth of salaries (not from the beginning of the year, but when they calculate it).
Increasing the guaranteed income for life insurance with capital accumulation from 0.25 to 1 percent. However, this still does not make this type of insurance profitable.
Lebensversicherung (life insurance)
Tax benefits
Tax incentives are provided for:
– hobby brewers
– those who install solar panels (no Umsatzsteuer on purchase and no income tax up to a certain limit when returning energy to the public grid).
Other tax changes
Bonuses from Krankenkasse will continue to be tax-free up to 150 euros. If the amount is higher, the costs incurred to receive the bonus can be deducted from it.
Parents’ expenses for child care up to 14 years of age (disabled also older): 80 percent of the amount can be written off, not two-thirds as before.
German tax return. Elster online. Anlage Kind
Kleinunternehmerregelung (small entrepreneurs) – the limits are raised: the lower one is now 25 thousand instead of 22 thousand, the upper one is 100 thousand instead of 50 thousand.
Tax declaration Germany. Anlage EÜR
If you were dismissed with severance pay (Abfindung), you are now responsible for managing tax benefits yourself (Fünftelregelung). Previously, this was handled by the employer.
New levies in 2025
Railway Tariff Increase
This also applies to the Deutschlandticket, which now costs 58 euros instead of 49 euros. Make sure you agree to the change in terms. In some cases, if you forget to do so, your contract will be invalid.
Germany ticket for regional public transport Deutschland-Ticket
Increase in car insurance
I think we were not the only ones who were shocked after receiving a bill for car insurance for the next year. This is explained by the increase in prices for car repairs. The increase is about 20 percent. You can compare rates, but you should not hope that someone forgot to increase them.
The rich also cry
For some, this news isn’t sad but rather joyful: high earners have been asked to step up to the cashier.
This was reflected in:
- lowering the limit after which Elterngeld is not paid – to 175 thousand.
- raising the limit after which social contributions do not increase.
As is known, social contributions make up a certain percentage of income, but no more and no less than a certain amount. This amount of “no more” has become larger: contributions do not increase after earning 5,512.50 euros gross per month for health insurance and care insurance, 8,050 euros gross per month for pension contributions and unemployment insurance.
Frankly speaking, this increase primarily affects those who do not earn that much (5,500 euros per month gross is not such a large amount in net) and is absolutely indifferent to those who really earn well.
Increasing health insurance and care insurance rates
I think many people received letters about this at the beginning of the year.
As we know, we pay from 7.3 (half the rate for employees) to 14.6 (self-employed) percent of our income for state health insurance in the basic form. However, this is not enough for the Krankenkasse, and they take additional percentages. These additional ones have increased once again this year, as a rule, by 1.20 percent or more. Most KK are between 17 and 18 percent, but in some cases they even take 19 percent.
When rates increase, you have the right to an unscheduled change of Krankenkasse. Calculate how much the difference in rates will be in your case, and compare this amount with possible bonuses, especially if you need something expensive, such as artificial insemination or homeopathy.
How to change health insurance in Germany
Part 1. GKV. How payments are formed
Those with private insurance may not rejoice too soon – they are also expected to increase. On average by 18 percent, but in each individual case it may be more or less. As with state insurance, the increase in rates means that you can change the contract.
Care insurance are also increasing by 0.2 percent.
Increase in postal rates
Sending a letter will cost almost a euro (95 cents), and a postcard, which used to be cheaper, will now cost the same amount.
Prices for sending parcels are also increasing – from 20 to 70 cents more.
At the same time, the post office now has the right to deliver letters not within two days, but only on the third day. (I would say that it does this anyway, so the new rule rather confirms the practice.)
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Entry into force of the land tax reform
Remember, we filled out the land declaration with boiling brains (this is for those who own land, including in the form of an apartment or garage)? These intellectual efforts of ours should have been processed accordingly over the past two years.
Now the communes can, with a clear conscience, raise our tax on this property. Expect a new bill. When preparing the reform, we were consoled that someone might even have their tax lowered. The legend is fresh, but hard to believe. Let’s hope that they will at least not raise it too much.
Kurzarbeit extension
To prevent industries from dismissing too many people, the Kurzarbeit permit is to be extended by a year. The Kurzarbeit is limited in duration so that industries only use this tool when it is really necessary. But the state also does not like mass layoffs, so the Kurzarbeit will be longer in 2025. Among those feeling the worst are the automobile industry, including long supply chains, chemists, and steelmakers.
Part 2. What’s new in Germany 2025. Consumption
All finance posts: #finance
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