Tax Changes 2026 in Germany: All the Key Numbers

Every year allowances, thresholds and flat rates shift — in 2026 unusually many at once. From the higher basic allowance to the uniform commuter allowance to the new e-invoicing obligation: this overview gathers the key German tax changes for 2026 with concrete figures, so you know exactly what applies to you.

In short: In 2026 the basic allowance (€12,348), Kindergeld (€259) and minimum wage (€13.90) all rise. The commuter allowance is a uniform 38 cents from kilometre 1. For investors the base rate for the Vorabpauschale rises to 3.20%, for the self-employed e-invoicing continues, and in hospitality food is taxed at 7% VAT again. Social contributions get more expensive.

For everyone: basic allowance, Kindergeld, tariff

• Basic allowance: €12,348 (+€252), €24,696 for married couples. Your taxable income stays tax-free up to this point.
• Kindergeld: €259/month/child (+€4). Child allowance: €9,756 (+€156).
• Fiscal drag (kalte Progression): the tariff thresholds shift so pay rises driven by inflation alone don’t push you into higher rates.

More on children in education in Kindergeld after 18 and Training allowance 2026.

For employees: commuter allowance, minimum wage, minijob

• Commuter allowance: 38 cents from kilometre 1 (previously 30 cents up to km 20). Work out your benefit with our commuter allowance calculator.
• Minimum wage: €13.90/hour from January 2026 (€14.60 from 2027).
• Minijob threshold: €603/month (previously €556) — linked to the minimum wage. Details in Minijob & minimum wage 2026.

How to get allowances onto your net pay during the year is shown in More net pay via a tax allowance.

For investors: the Vorabpauschale rises

The base rate for the 2026 Vorabpauschale was set at 3.20% (2025: 2.53%). This means even if you don’t sell your ETF shares, you pay a small advance tax in early 2027 on the notional gain. The saver’s allowance (Sparerpauschbetrag) stays at €1,000 (€2,000 for couples). Everything on this in Vorabpauschale 2026 and Saver’s allowance & exemption order.

For the self-employed: e-invoicing, depreciation, hospitality

• E-invoicing: businesses have had to be able to receive electronic invoices since 2025. The obligation to issue them starts in 2027 (turnover over €800,000), and from 2028 for everyone. What to do now: E-invoice mandate for freelancers.
• Investment booster: 30% declining-balance depreciation for movable assets (acquired 1 July 2025–31 Dec 2027). Details: Investment booster & declining depreciation.
• Hospitality: food is taxed at 7% VAT again from 1 Jan 2026 (drinks stay at 19%). More in Restaurant VAT 2026.

Social contributions: it gets more expensive

• Contribution ceiling (health/care): €69,750/year (€5,812.50/month). Higher earners pay contributions on a larger share. Details: Contribution ceiling 2026.
• Health insurance supplementary rate: on average 2.9% (previously 2.5%).
• Long-term care insurance: 3.6% (childless over 23: 4.2%).

Common mistakes

1. Ignoring the higher basic allowance. On low incomes it can produce a refund.
2. Calculating the commuter allowance the old way. From 2026, 38 cents count from the first kilometre.
3. Overlooking the Vorabpauschale. The bank debits it automatically — without an exemption order it reduces your liquidity.
4. Sleeping on e-invoicing. You must already be able to receive them today.

How Restio helps

A lot changes for tax in 2026 at once — and most changes don’t come with a reminder. Restio keeps track for you:

• Personally relevant — Restio filters the flood of changes down to what matters for your situation: do you commute, invest, run a business?
• Instant answers — ask in English or German: “How much more commuter allowance do I get in 2026?” or “Does e-invoicing affect me?”
• Financial Guardian — you get a timely heads-up when a change triggers a deadline or an adjustment for you.

For a binding assessment of your individual case, consult a tax advisor (Steuerberater). The official overview is at the Federal Ministry of Finance.

2026 is not a year to do your taxes “the same as always”. Knowing the new figures gets you higher allowances, the full commuter allowance, and avoids nasty surprises on social contributions and the Vorabpauschale.