Germany’s six tax classes: who falls into which, and why

Last checked against the official sources: 29 August 2026

A tax class is not a personal preference or a colleague’s tip; it is a classification the statute imposes in § 38b of the Income Tax Act. Most people have no choice in it at all — genuine choice exists in exactly one place: married couples. And the most misunderstood point is that class IV is the default for married couples, while III and V are an exception that arises only on a joint application by both spouses.

Rule and exception: IV comes before III and V

Read the order of the provision carefully; it overturns a common belief. Class IV applies to married people once three descriptions hold: marriage, unlimited tax liability of both, and no permanent separation. No application and no procedure is needed.

The statute then adds a sentence that settles a frequent case: class IV also applies where one spouse draws no wage and no application for class III has been made. A non-working spouse therefore does not automatically move the household into III and V.

Classes III and V, by contrast, only come into being on an application by both spouses. They are two sides of one coin: whoever enters III necessarily places their partner in V, and neither exists without the other.

Class I is wider than people assume

Class I is not simply “the single people’s class”. The statute puts three groups in it:

• unlimited taxpayers who are single;
• unlimited taxpayers who are married, widowed or divorced and do not meet the conditions of III or IV — someone married to a person without unlimited liability, for instance, or permanently separated spouses;
• everyone with limited tax liability — those not tax-resident in Germany.

That third group covers many cross-border workers and people employed in Germany with families abroad: limited liability puts you in class I whatever your marital status.

A further limit settles cross-border cases: the statute says that “unlimited tax liability” for numbers 3 and 4 specifically means only persons meeting § 1(1) or (2) or § 1a. Marriage alone is not enough for III or IV unless both spouses fit that description.

Class II is not granted on children alone

Class II is not “the class for people with children” but the class for someone who fits class I and for whom the relief amount for single parents under § 24b must be taken into account. The criterion is entitlement to that relief, not the presence of children in the home.

The difference is practical: many separated parents remain in class I because the conditions for the relief are not met, and pay monthly either more or less than they should. Read § 24b before applying for a change.

Widows and widowers: one year, in the text

A widowed person is placed in class III on two cumulative conditions: that they and the deceased spouse had unlimited tax liability at the time of death, and were not permanently separated at that time. The period is precisely fixed: for the calendar year following the year in which the spouse died.

A third, rarely mentioned case also exists: a person whose marriage was dissolved is placed in class III for the year of dissolution where both spouses had unlimited liability that year and were not permanently separated, and the other spouse has remarried, is not permanently separated from the new spouse, and both of them have unlimited liability.

Class VI, and what the choice does to your return

Class VI is not a penalty but a mechanism: it governs withholding on wages from the second and any further employment where wages are drawn from several employers at once. The reason is that no employer knows what you earn from the other, so the second is withheld at the highest rate and settled later.

Which brings the consequence that surprises most people: choosing a class does not change the final tax, only how it is spread across the months. Settlement happens at the annual assessment. The statute therefore ties class to return: an assessment is mandatory where jointly assessed spouses both received wages and one was taxed under class V or VI, or under class IV with the factor recorded. It is equally mandatory for anyone who received wages from several employers at the same time.

Put plainly: opting for III and V brings a filing duty with it. Anyone who chooses them to raise their monthly net should not be surprised by a settlement demand at year end.

And where child allowances appear

Child allowances do not name a class; they are entered as a withholding feature within classes I to IV: with a counter of 0.5 where the employee is entitled to half the allowance, and a counter of 1 where they are entitled to the whole — for instance where the conditions of § 32(6) sentence 2 apply, where the other parent died before the start of the calendar year, or where the employee adopted the child alone.

Any further allowances due beyond that are taken into account on application.

Frequently asked questions

Which class applies to married couples automatically?

Class IV, wherever both spouses have unlimited liability and are not permanently separated — including where one earns no wage and no class III application was made.

Can I choose class III on my own?

No. Classes III and V arise only on a joint application by both spouses, and one entering III necessarily places the other in V.

Why am I in class I although I am married?

Because class I covers married people who do not meet the conditions of III or IV, and covers everyone with limited tax liability regardless of marital status.

Is class VI a penalty?

No. It is the withholding mechanism for a second and further employment, because the second employer does not know your income from the first. Settlement follows at the annual assessment.

Does the class change my final tax?

No, only how it is spread across the months. Settlement comes at the assessment — which becomes mandatory with class V or VI, or class IV with the factor.