Pauschbeträge

Pauschbeträge are fixed deduction amounts in German tax law that allow taxpayers to reduce their taxable income without proving the exact costs incurred. They are designed to simplify the calculation of certain expenses by providing a standard allowance that applies regardless of the individual’s actual expenditure.

Common examples include:

- Werbungskostenpauschale (Arbeitnehmer-Pauschbetrag) for employees, a flat-rate deduction for work-related costs that is applied in the tax calculation; taxpayers can still claim higher actual expenses if they itemize.

- Sonderausgabenpauschale for certain special expenses, reducing the tax base when these costs are not documented individually (for example, some insurance premiums and church tax).

- Behindertenpauschbetrag for people with a disability; the allowance varies with the degree of disability and increases with greater impairment.

- Sparer-Pauschbetrag for capital income; a fixed annual allowance that reduces tax on investment income (currently 801 euros for single taxpayers and 1,602 euros for married couples).

Application and choice: Pauschbeträge are applied in the annual income tax return (Einkommensteuererklärung) and, in some cases, are automatically reflected in payroll or withholding calculations. Taxpayers may choose between the flat-rate Pauschbetrag and the alternative of proving actual costs if this would yield a higher deduction, depending on the category.

Legal basis and purpose: Pauschbeträge are established by German tax law (EStG and related regulations) to streamline administration, reduce compliance burden, and provide predictable relief for common expense types. They coexist with itemized deductions and other allowances, and their use depends on the taxpayer’s individual situation.