Tax Class I in Germany – applicable regulations for single individuals

Germany is one of the leading European countries with a strong economy and a complex tax system. A central element of this system is the so-called tax class regulation (Steuerklassen), which plays a significant role in the taxation of both citizens and foreigners working in the country. Particular attention should be paid to tax class I, which has a considerable impact on the amount of income tax paid by single employees. The following outlines its characteristics, the eligible group of persons, as well as the advantages and obligations of this form of taxation within the German tax system.

Income tax rate in tax class I 

A fundamental question for persons taking up employment in Germany – what is the income tax rate in tax class I? This question is justified, as it has a significant effect on net income. In Germany, a progressive tax rate applies, which must be uniformly applied to all taxpayers regardless of tax class. The rule is clear: those with higher income are subject to a higher tax rate. 

The lowest income tax rate in tax class I currently amounts to 14 percent and applies to taxable income abovethe basic allowance (12,348 euros). For income ranging from €12,348 to €69,878 per year, the rate increases progressively – from 14% up to 42%. 

Social security contributions in tax class I

The following social security contributions must be paid in tax class I in Germany:

• Solidarity surcharge – surcharge of 5.5% on the income tax, currently only for high incomes above 20,350 euros (individual assessment) or 40,700 euros (joint assessment),
• Church tax – for all persons belonging to a church – rate 8–9% of income tax,
• Long-term care insurance – contribution 3.4% (around 3.6–4.0% for childless persons with a surcharge of approx. 0.35–0.6%), levied up to income of 5,812.50 euros/month (69,750 euros/year); half paid by the employer,
• Pension insurance – contribution 9.3% of the monthly remuneration up to 8,450 euros, the other half paid by the employer,
• Unemployment insurance – contribution 2.6% (1.3% each paid by employee and employer) on monthly salaries up to 8,450 euros,
• Statutory health insurance – 7.3% of the monthly remuneration up to 5,812.50 euros, additional contributions depending on the selected health insurance fund are possible – half paid by the employer.

Different social security regulations apply to interns, students and marginally employed persons (Minijob).

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With regard to tax class I, a tax return should not be categorically considered unnecessary. Although many single persons in employment in Germany are not required to submit a tax return, overpaid taxes can often be reimbursed – for example, for commuting costs, employment during part of the year, or other deductible expenses. Before deciding against filing a tax return, a review of potential reimbursement entitlements is therefore always advisable.

Tax benefits in tax class I

The final wage and the ultimate tax burden in tax class I are also affected by numerous tax allowances. Of central importance is in particular the basic allowance – a portion of income that remains completely tax free. In 2026, it applies to all persons in employment in Germany and amounts to 12,348 euros.

There are also other statutory, non-taxable portions of income – these, however, depend on the individual situation. For the year 2026, the following benefits apply in tax class I:

• Lump sum for income-related expenses – 1,230 euros (higher deductions are possible upon submission of evidence for higher costs),
• Lump sum for special expenses – 36 euros,
• Child allowance – 9,756 euros for both parents together,
• Allowance for care, education, and training per child – 1,320 euros.

Deductible amounts in tax class I

Regardless of the assigned tax class, the possibility of deductions in the income tax return always depends on the individual circumstances of the taxpayer. It is advisable to determine the deductible costs if deviating from the income-related lump sum of 1,230 euros is intended. This can be particularly beneficial for a better tax refund if higher income-related expenses were incurred during the relevant year. 

Particularly noteworthy is the distance allowance for commuting between home and workplace amounting to 0.38 euros per kilometer from the first kilometer, especially for daily commutes exceeding 20 km. For self-employed persons or those working from home, simplified deductions for a home office up to 1,260 euros annuallyare also available; for income exceeding the basic allowance of 12,348 euros, taking out private health insurance as an alternative to the statutory system can be considered, in order to avoid the additional contribution and adapt the policy to individual needs.

Difference between tax class I and IV 

Tax classes I and IV differ primarily with respect to the marital status of the taxpayer. Tax class I generally applies to single persons, while tax class IV is intended for married couples or registered civil partners who are neither permanently separated nor forgoing earned income. In the IV/IV combination, each spouse is taxed separately based on their own income within the scope of the monthly wage tax calculation — this does not automatically result in a lower tax burden than class I. The actual tax relief depends on the income of both spouses and the final annual adjustment. 

Difference between tax class I and III

Tax class III is intended for married couples in which one spouse earns significantly more than the other. In this constellation, the combination is most advantageous. Tax class III enables the balancing of income differences within the marriage through tax relief. A change from tax class I to class III is therefore only possible upon marriage.

Is a change from tax class I to tax class II possible?

The tax class is usually assigned automatically by the German tax office – the decisive factor here is primarily marital status. Single persons without children generally have no option to switch and basically remain in the assigned tax class I.

If a change in personal circumstances occurs and an adjustment of the tax class is desired, this may also be done multiple times per year. To this end, an appropriate application must be submitted to the tax office. It should be noted that for other tax classes, a marriage contract is not required – for example, tax classes III, IV, and V are also available to individuals in a registered civil partnership.

For single parents with children, a switch from tax class I to tax class II should be considered, as this enables the single parent relief amount to be claimed.

Is a tax return required for tax class I?

Without precise knowledge of an individual’s situation who is employed in Germany, a definitive answer to this question cannot be provided. The tax class is not the sole factor; numerous other circumstances are relevant in this context. Although many individuals with tax class I are not required to submit a tax return, this is a complex subject that has already been addressed in the article – Who is required to file a tax return in Germany? –. It should be noted that the German tax office may, but is not obliged to, request submission, making it advisable to independently verify whether an income tax return is mandatory.

For persons who are part of the group required to file a tax return with the German tax office, appropriate support is recommended. The tax return app Taxando is suitable for handling the formalities quickly and easily – downloading the program is recommended.