Basis for Tax Liability
The tax liability for vocational training compensation is governed by the general tax regulations in Germany. According to the Income Tax Act (EStG), all individuals residing or having their habitual abode in Germany are subject to tax. This also includes apprentices whose income comes from vocational training compensation.
Basic Allowance
The basic allowance defines the income level up to which no income tax must be paid. For the year 2025, this allowance is €10,908 annually. If the annual vocational training compensation is below this threshold, no income tax applies. Only once the total income exceeds the basic allowance is the exceeding part taxed.
Income Tax Deduction
As soon as the vocational training compensation exceeds the basic allowance, income tax becomes due. The income tax is withheld by the employer and paid directly to the tax office. The amount of income tax depends on the apprentice’s tax class:
- Tax Class I: Unmarried apprentices without children
- Tax Class II: Single parents apprentices
- Tax Class III: Married apprentices with a spouse without income
- Tax Class IV: Married apprentices with a working spouse
Additional Taxes
In addition to income tax, the following additional taxes may apply to vocational training compensation:
- Church Tax: If the apprentice belongs to a religious community that is subject to tax, church tax is due. This amounts to either 8% or 9% of the income tax, depending on the federal state.
- Solidarity Surcharge: The solidarity surcharge is 5.5% of the income tax. However, it is only levied if the income tax exceeds a certain threshold, meaning many apprentices are not affected by this.
Deductible Expenses and Allowances
When calculating the tax liability, a standard deduction for work-related expenses of €1,230 per year is automatically taken into account. If the apprentice incurs higher work-related expenses, such as travel costs to the training location or vocational school, these can be claimed in the tax return. This reduces the taxable income, which can lead to a lower tax burden.
Tax Liability and Tax Refund
If income tax has been paid during the year, the apprentice has the option to receive a refund through a tax return. This is especially the case if the total income at the end of the year falls below the basic allowance or if high deductible costs, such as work-related expenses or special expenses, can be claimed.
Tax-Free Components of Compensation
Certain components of vocational training compensation are tax-free and do not increase the tax burden. These include:
- Employer contributions to travel costs
- Meal allowances in the form of meal vouchers
- Expense reimbursements for business trips
Important Notes on Tax Liability
Tax liability applies to apprentices only when their compensation exceeds the basic allowance. In most cases, vocational training compensation remains tax-free, especially when the training starts during the year, resulting in lower income. However, it is advisable to submit a tax return since, in many cases, a refund of paid income tax is possible. Apprentices should regularly check their pay slips and contact the payroll department of their training company or the tax office if they have questions.