Parental allowance

What is parental allowance?

The parental allowance is a family benefit in Germany that serves to secure the economic existence of mothers and fathers with small children, i.e. the livelihood.
The parental allowance is a so-called remuneration replacement benefit of the state, which is granted by the social security agencies. Since 2007 there has been a law that regulates parental allowance and parental leave, the Federal Parental Allowance and Parental Leave Act. The parental allowance is dependent on the net income and replaces the previous childcare allowance. All parents who are not or not fully gainfully employed due to the care of the child and who have to interrupt their job to look after the child are entitled to this family benefit.

Mothers and fathers receive parental allowance beyond the period of maternity leave. Parents generally receive parental allowance for 12 months from the point in time immediately after the birth. It is possible to extend the period with two partner months to fourteen months and single parents are also entitled to fourteen months of parental allowance. The amount of parental allowance depends on the net income of the parent who applies for parental allowance. In addition, parents who were without work or income before the birth of the child receive the minimum amount of parental allowance of € 300.00 for a period of fourteen months. There are three variants of parental allowance: basic parental allowance, ElterngeldPlus and the partnership bonus.

What is the parental benefit application?

In order to be able to receive parental allowance, it is necessary to apply for parental allowance, also known as parental allowance, at an early stage. The prerequisite for the application is a birth certificate for the child. This means that the application can only be submitted after the birth. You should apply for parental allowance within the first three months after the birth of the child, which allows retroactive payment of parental allowance for a maximum of three months from the date of application. Each federal state has its own parental allowance offices to which the parental allowance application is sent. In some federal states, Bavaria and Saarland, it is possible to submit the parental allowance application online.

The Federal Ministry for Family, Seniors, Women and Youth provides information about and arranges the competent parental allowance offices to which the applications are submitted. Each state has its own form. The form for the parental allowance application can also be obtained from the responsible parental allowance office. In addition to the birth certificate, the application requires proof of previous income, the most recent tax assessment and, if necessary, other documents, such as certificates of health insurance during maternity leave with private health insurance.

For more detailed information on this topic, see: Parental benefit application - what do I have to consider?

When do I get parental allowance?

The parental allowance is transferred when the application has been properly completed and processed by the parental allowance office.
Depending on the birth rate in the region and the lack of staff in the authority, the processing of the application can take different lengths of time. You can receive parental allowance retrospectively for up to three months. This means that you should apply for parental allowance as soon as possible after the birth of the child and within three months after the birth. The processing of the parental allowance application usually takes several weeks. This means that you should submit the application as early as possible in order to receive parental allowance in the first two to three months after the birth of the child.

You may also be interested in this topic: Child-rearing time

How long do you get parental allowance?

In principle, every family receives parental allowance for twelve months from birth.
In addition, two partner months are possible if the partner who is working before the birth takes part in childcare for at least two months. This requires a reduction in employment to at least thirty hours per week during this time. In exceptional cases, you can receive parental allowance for up to fourteen months after the birth of the child if the partner is unable to care for them due to a disability, illness or prison sentence. Single parents with sole custody also have the right to parental allowance for fourteen months.

How much parental allowance do I get?

As a rule, the parental allowance is 65 to 67% of the applicant's average net income for the twelve months before the child's birth. In exceptional cases, you can even receive up to 100% of the average net income for the year before the child is born. You receive at least € 300.00 and a maximum of € 1,800.00 parental allowance per month.

How can I calculate the parental allowance?

There are numerous calculators on the Internet that calculate parental allowance. Important factors are the assessment period, current wages, gross parental allowance, flat-rate tax deduction and social security contributions. The relevant assessment period is the last twelve months before the birth of the child. With regard to the current salary, one-off special payments from the employer such as Christmas or vacation pay are deducted. The gross parental allowance is the monthly wage with deduction of the employee lump sum (€ 83.33 per month). Flat-rate social security deductions mean deductions such as 9% for health and long-term care insurance, 10% for pension insurance and 2% for unemployment insurance (a total of 21% for social security contributions). Finally, the parents receive the net parental allowance, which is made up as follows:

Parental allowance net = parental allowance gross - tax deductions - social security deductions

For the exact amount of parental allowance that you ultimately receive, the parental allowance net must be multiplied by the parental allowance replacement rate. You can calculate parental allowance online or ask a parental allowance office and ask for help with the calculation.

Parental allowance for the 2nd child

The parental allowance is calculated individually for each child. In principle, parents are entitled to parental allowance for every newborn child. For the calculation of the parental allowance, the 12 months before the birth of the child are essential. If parental allowance was still paid within these 12 months, for example in the first four months of the calendar year, due to an older child, the assessment period can be changed at the request of the parents when submitting the application. This means that in this case, for example, four months before the birth of the first child can be offset against the remaining eight months before the birth of the second child.

If desired, the overlapping months can be excluded and calendar months shifted back. This may sound complicated, but it can lead to a higher amount of parental allowance for the second child, which can help many families. In order to adjust the assessment period, you can seek help with the application from the responsible parental allowance office. In addition, there is a sibling bonus as an increased parental allowance if the second child is born before the first child turns exactly three years old. If the first child is more than three years old when the second child is born, this bonus does not apply. The sibling bonus is 10% of the regular parental allowance and at least € 75 per month. In the case of a twin or other multiple birth (such as triplets), the parental allowance increases by at least a further € 300.00, so that the parents receive at least € 600.00 per month for twins and at least € 900.00 for triplets.

What is meant by Parental Allowance Plus?

The ElterngeldPlus is an opportunity for families who want to get back to work early, to better combine work and family. With ElterngeldPlus, parents have the option of receiving parental allowance twice as long. The parental allowance for twice the period is then a maximum of half the amount for twelve months of parental allowance. This means that one month of parental benefit can be turned into two parental benefit plus months, so to speak.

Parents who would like to split up the childcare time as a partnership and opt for an individual time arrangement, so to speak, receive four additional ElterngeldPlus months if both partners work between 25 and 30 hours per week during this period. Single parents are also entitled to the four-month Parental Allowance Plus bonus. The ElterngeldPlus is very popular and promotes the partnership-based sharing of childcare between the parents and, in particular, promotes care by the fathers. It is a good opportunity to enable parents to return to part-time work earlier and to support childcare.

How and where can I find my parental allowance office?

Since every federal state has its own parental allowance offices, you have to check which parental allowance office is responsible for you. The Federal Ministry for Family, Seniors, Women and Youth provides information on family benefits such as parental allowance and provides an online search function for the nearest competent authority. You can also find out more by phone or, if you know where the positions are, appear in person during office hours and ask questions.

How do I get parental allowance advice and what advice is given there?

Parental allowance is a complicated topic that costs one or the other a lot of time and nerves. Parental allowance advice can help to get as much parental allowance as possible on time, save time and nerves and encourage quick processing of the parental allowance application. You apply for parental allowance at the parental allowance offices that belong to the respective offices for care and social affairs. Depending on how revised the responsible parental allowance offices are, the help and advice provided by the parental allowance offices may be more or less sufficient.

In principle, it is the parental allowance offices that provide help with the application. Advice from the responsible authorities is free of charge. You should inquire beforehand (by phone) which documents are required and call the service phone of the respective parental allowance office to make an appointment. The Elterngeldstelle advises on how to fill out the application and what options there are with regard to the partnership bonus or ElterngeldPlus.

The service telephone of the Federal Ministry for Family, Seniors, Women and Youth can be used for any information and is manned Monday to Thursday from 9 a.m. to 6 p.m. on the telephone number 030-20179130. In addition, there are numerous more or less reputable websites and hotlines on the Internet that offer advice on parental allowance for up to more than two hundred euros. Other websites provide free tips on how to apply for parental allowance. We recommend that you seek advice from the responsible parental allowance office and, if necessary, ask the service telephone number of the Federal Ministry for Family, Seniors, Women and Youth for support.

also read: Parental advice

How does the parental allowance affect my tax return?

Parental allowance is basically tax-free! Nevertheless, it must be entered in the tax return, as it is subject to the so-called progression proviso. Parents are obliged to submit an income tax return for the years in which they received parental allowance on a regular basis. Parental allowance is noted in Annex N to the tax return in line 29 under "Other wage and compensation benefits". Even if you don't officially have to pay taxes when receiving parental allowance, it is not so easy with parental allowance.

The term progression reservation means that the said income, the parental allowance, is tax-free per se, but increases the tax burden due to the progression reservation. This means that the parental allowance is offset against other income, for example the salary of the spouse. The result is that its tax rate rises. This additional burden increases especially with low wage earners. It is worth doing a thorough calculation beforehand and, if necessary, consulting a tax advisor.

What is the Parental Allowance Fund?

A parental benefit fund is a parental benefit office. The terms are used synonymously and represent the authority that is responsible for the parental allowance. This means that you apply for parental allowance at the Elterngeldkasse (parental allowance office).

What is the partnership bonus?

The partnership bonus is a bonus for parents who share the care of the child together. If the parents share childcare for at least four months and work between 25 and 30 hours a week during this time, the family receives an additional four months of ElterngeldPlus. The requirements for the partnership bonus are therefore:

• Both parents must work part-time at the same time for a period of at least four months

• The weekly working hours of both parents must be between 25 and 30 hours per week

• The four months in which both parents work must be done in one go

• One parent must receive the ElterngeldPlus from the child's 15th month

The partnership bonus is particularly worthwhile for parents who earn roughly the same amount.

How about the parental allowance for twins?

Parents who give birth to twins cannot provide double parental allowance for both children. Since 01/01/2015 there is another possibility for twins to receive more parental allowance. This is the so-called multiple surcharge. For the twin who is born first, the parents receive the amount of parental allowance to which they are entitled based on their previous income (usually around 65% of this). For the “younger” twin, the parents receive a multiple surcharge amounting to € 300.00. This sum is fixed and also applies to triplets and other multiple births.

Can I take a mini-job while I receive parental allowance?

In the past, there was an allowance as part of the parental allowance, i.e. a sum that you could earn monthly without giving up any money. There is no longer this allowance. You can accept a mini-job while receiving parental allowance. The only condition is that you work a maximum of 30 hours a week. The only problem is that being hardworking is not always worthwhile. If you earn extra money, the parental allowance office determines the difference between the parental allowance net and the additional income from the mini-job. The previously applicable replacement rate (usually 65%) is then only applied to the difference and paid out as new parental allowance. Before accepting a mini-job during the parental allowance, you should calculate how much money is actually left after the settlement.

When is parental allowance paid?

If the application for parental allowance has been submitted and accepted, the parental allowance will be transferred every month for the next twelve months. The sum is always paid out during the month. This means that the parental allowance should be paid on the last day of the first month of life at the latest. If a child is born on July 12, 2017, the parental allowance should have been transferred by August 11, 2017 at the latest.

Depending on how the application for parental allowance has been processed, it may take a few weeks for the application to be processed. Parental allowance can be paid retrospectively for up to three months. You should make the application for parental allowance soon after the birth. The parental allowance is then generally paid out during the month for which it is intended. On a special request, you can split the parental allowance into two half amounts, which are then transferred twice a month.

Parental Allowance and Maternity Allowance- What is the Difference?

The maternity allowance is a compensation payment for working women during maternity leave, i.e. the period six weeks before the birth of the child until eight weeks after the birth (a total of fourteen weeks). During this time, working women should be protected and spared and therefore receive the maternity allowance within the framework of maternity protection. Women who are entitled to maternity benefit also receive a subsidy from their employer to supplement the maternity benefit.

This is intended to compensate for the loss of earnings as much as possible during the prohibition of employment of the pregnant woman or the new mother. While the maternity allowance is a compensation benefit that serves to protect the health of the mother and the newborn, the parental benefit is a compensation benefit that supports the care of the child and a return to part-time work. The maternity allowance is paid over fourteen weeks and the parental allowance for twelve months, the ElterngeldPlus even twenty-four months and with the partnership bonus even longer. The total also differs. The maternity allowance is usually higher than the parental allowance.

Read more on the topic: Maternity allowance

Is there parental allowance in the event of unemployment?

Yes, there is parental allowance in the event of unemployment. If you receive unemployment benefit I and parental benefit at the same time, the parental benefit will be offset against the unemployment benefit up to an exemption of € 300 per month. This means that you get practically € 300 parental allowance in addition to unemployment benefit. People who receive unemployment benefit II are theoretically entitled to parental benefit. However, here too, the parental allowance is offset against the unemployment benefit, so that overall you do not get more money. An exception are the parents who worked until shortly before the child was born. In these circumstances, the parents concerned can top up their finances. As always, the amount of the parental allowance is based on the previous income and amounts to a maximum of € 300. This means that parents with a previous income of an average of € 200.00 per month now receive an allowance of € 200.00 per month.

Is there parental allowance if I receive Hartz IV?

Unemployment benefit II, or ALG II or Hartz IV for short, is intended to finance the subsistence level for people in Germany. Theoretically, Hartz IV recipients are entitled to parental allowance. In practice, however, the parental allowance is offset against the Hartz IV, so that the parents generally get nothing. The recipients of ALG II who worked until shortly before the birth have the option of up to € 300.00 per month parental allowance. In this case, the parental allowance is based on the income shortly before the birth, with an average salary of € 200.00, Hartz IV recipients then receive € 200.00 parental allowance per month.

Is there parental allowance during maternity leave?

Maternity leave begins a few weeks before the child is born and continues for eight weeks after the birth. During this time, the statutory maternity protection period, which is intended to protect women, applies. The maternity benefits and the parental allowance serve the same purpose and are intended to replace the loss of income that begins at the time of birth. Parental allowance is available from the child's first month of life, including maternity leave.

Find out more about the topic: Maternity Protection

What are the requirements for parental allowance?

According to Section 1 (1) of the Federal Parental Allowance and Parental Leave Act, the requirements for receiving parental allowance are as follows:

• You must have your domicile or habitual residence in Germany

• You have to be in the same household with your child while receiving parental allowance

• You have to look after and raise the child yourself

• At the time of receiving parental allowance, you are not in employment or work part-time

For parents who gave birth on July 1st, 2015, the new regulations on basic parental allowance, ElterngeldPlus and the partnership bonus also apply.

What is the employer certificate for parental allowance?

The employer certificate is a document that is added to the application for parental benefit. This certificate includes information from the employer on the employment relationship, the employer's maternity protection benefits during the maternity protection period and, if applicable, on part-time work while receiving parental allowance. The document is filled out and signed by the employer and submitted with the parental allowance application to the responsible parental allowance office.

Can you extend parental allowance?

In principle, parents are entitled to parental allowance for twelve months. The parental allowance can be paid in full for a maximum of fourteen months. This extension by two months longer works with the help of the partnership bonus. Both parents have to look after the child together for two months and are not allowed to work full-time. With ElterngeldPlus, 50% of the Elterngeld is paid out over twice the period. A payout over twenty-four months is possible here, and with the partnership bonus even twenty-eight months.

Does parental allowance affect the Christmas allowance?

The Christmas bonus is a one-time special payment, a bonus that is paid in addition to the salary. This means that you receive the parental allowance parallel to the Christmas allowance. Basically, the parental allowance has no influence on the Christmas allowance. However, special payments such as Christmas or vacation pay are taken into account when calculating the parental allowance and can lead to a larger amount of parental allowance per month.

How can you split the parental allowance between the parents?

There are basically four ways of dividing parental leave. A joint parental leave is one possibility, for this the father can start his parental leave immediately after the birth and the mother after eight or twelve weeks of maternity leave. This variant gives the parents an opportunity to get to know each other intensively as a new family and to look after the child together. Another option is a combination of part-time and parental leave. Both parents take parental leave and continue to work part-time. One parent can look after the child in the morning and the other parent can look after the child in the afternoon.

A maximum of 30 working hours per week is required. There is also the option of changing in the middle. The mother can look after the child for seven months on parental leave and then the father for seven months. Depending on the income of the parents, it is worthwhile to work out beforehand how this division of work / care will affect the family benefits. Last but not least, there are the two partner months. These can be used to make full use of the parental allowance and to split the child care for two months.

Does the parental allowance start earlier in the case of a premature birth?

The parental allowance always begins with the actual due date. This means that the parental allowance starts earlier in the case of a premature birth, namely with the birth of the child. Since the parental allowance is offset against the maternity allowance, the mothers unfortunately lose part of the parental allowance which is not offset in the event of a premature birth.

How does the parental allowance affect the pension insurance?

In principle, no contributions are paid into the pension insurance from the parental allowance. As parents, however, you can apply for the actual pension amount to be credited. Parents are entitled to three years of child-rearing leave and a full pension at the same time.

So that you can secure your pension in full, you should submit an application before the start of the pension by claiming the three years of child-rearing time. In this way, the pension is taken into account despite the parental allowance.

Are you interested in this topic? Then read our next article below: Child-raising time - what should you consider?

Can I count a company car against the salary basis of the parental allowance?

If the employer provides an employee with a company car as a subsidy for maternity protection and during parental leave, it can be used. A company car can then, so to speak, be used as a contribution in kind. If a Tuesday is used completely privately during parental leave, it will be used in accordance with Section 8 (2), sentence 1. Income Tax Act and can lead to a reduction in the parental allowance. A company car as a privately used car represents a pecuniary benefit for the parents and must therefore be stated. This means that a privately used company car can reduce the parental allowance during parental leave.

Can I have rental income offset against parental allowance?

The amount of parental allowance is made up of the average net income that was earned in the twelve months before the child was born. Income such as rental income, leasing and capital assets are irrelevant and are not offset against the parental allowance. They are not deducted at the same time!

How do annual special payments affect the parental allowance?

Annual special payments such as bonuses, premiums, Christmas and vacation pay are taken into account when calculating parental allowance.Since the parental allowance is based on the average net income of the last twelve months in employment, annual special payments can have a positive effect on the parental allowance and lead to a higher monthly parental allowance.