Contributing a portion of one’s earnings to the church has been a longstanding practice in European tradition, spanning centuries.
Today, numerous countries uphold this tradition by collecting a “church tax” on behalf of officially acknowledged religious organizations, sometimes applying it to all registered members. These collective contributions amount to billions of euros each year and serve as the primary source of income for many religious institutions.
So, read on to find out how church tax and tax exemption works for Germans and expats and to determine if you belong to a church tax collecting denomination.
Who Pays Church Tax?
In Germany, the church tax, known as Kirchensteuer, is a mandatory financial obligation for members of specific religious communities. Normally German tax payers are only obliged to pay a church tax when they are declared members of mainly either the Catholic (~24 Mio. members) or the Protestant church (~23 Mio. members) here in Germany* (go to the end of this article for more details).
As a German, you become a member of those churches first by being baptized andd later on when you state your membership by a ceremony either called confirmation (Protestants) or Firmung (Catholics).
So, if your parents decide not to get you baptized, you are not automatically a member of any church and will not be obliged to pay church tax. You can decide to get baptized at any time in your life.
A friend’s 9 year old son recently wanted to get baptized as he was wondering what (confession) he actually was („Mama, was bin ich eigentlich?“). Quite to the surprise of his pretty atheist parents, he got baptized and is now awaiting his communion (Catholic).
How Church Tax Works for Expats
Upon your arrival in Germany, one of your initial tasks is to complete the registration process at the local government office (Anmeldung) by submitting an official form. Within the Anmeldung form, you will encounter inquiries related to religion.
At the Bürgeramt in your local Rathaus you will have to fill out this form on which you declare your respective church. It simply says: „Religion (nur ev., rk. oder ak.)“.
- ev.=evangelisch=protestant
- rk.=römisch-katholisch=Roman-Catholic
- ak=alt-katholisch=Old-Catholic.
Do I Have To Pay Church Tax In Germany?
There are nine state-recognized religious communities that are authorized to collect church tax in Germany. If you want to know if you belong to a tax collecting religious community, here is the list:
- Evangelical churches
- Catholic churches
- Old Catholic Church
- the Jewish community
- Israelite religious communities
- Free religious communities
- Reformed Church of France in Berlin
- Mennonites community in Hamburg-Altona
- Unitarian religious communities in Rhineland-Palatinate
If you are affiliated with the following religious communities, you are exempt from paying church taxes in Germany:
- Orthodox
- Baptist
- Salvation Army
- Jehovah’s Witness
- Muslim
- Buddhist
- Hinduism
For those without religious affiliation, it is advisable to either leave the corresponding field blank or use a dash to indicate its inapplicability. However, if you adhere to a specific religion, be sure to clearly specify your religious affiliation.
It is also important to highlight that if you adhere to a religious faith and wish to join Catholic, Protestant, or Jewish communities or use their services—such as for marriage, baptism, or a Christian burial—you are required to register and fulfill the associated church tax obligations.
Getting Charged
Your local registration office will transmit your details to the Finance Ministry (Finanzamt). Based on your responses regarding religion and taxation data, tax authorities will then determine whether to associate your tax ID with church taxes or not.
After the tax is collected by the tax office (Finanzamt), it is passed on to churches for an estimated 3% administrative fee. If you want to know how much church tax you would end up paying, you can calculate it with the help of this German church tax calculator.
der Heiland-the saviour / Image from Pixabay
Income Tax Assessment
If membership in a tax-collecting religious community is entered on the document, the employer must withhold church tax prepayments from the income of the employee in addition to other tax prepayments.
Your monthly pay slip in Germany includes a line item for “church tax payments,” calculated by your employer based on your wage tax minus any child allowances.
This tax is then directly forwarded to the tax office, contingent on your electronic income tax card indicating your religious affiliation, such as “ev” for Protestant or “rk” for Roman Catholic church.
The amount of church tax paid depends on your payroll tax, while the church rate varies by region—8 percent in Bavaria and Baden-Württemberg and 9 percent in other states. Certain regions, like the dioceses of Limburg and Speyer in Rhineland-Palatinate and parts of Hesse, also impose a church property tax, approximately 10% of members’ real estate property tax assessment.
Additionally, if you are a member of a church with capital income exceeding the general savings allowance, you pay church tax on settlement tax at a rate of 8 or 9 percent, depending on your location. Notably, the church tax on capital income cannot be separately deducted as it is automatically factored into the settlement.
In the case of self-employed persons or unemployed taxpayers, state revenue authorities collect prepayments on the church tax together with prepayments on the income tax. Here is more on working in Germany in our Smarter German blog.
When It’s Already Too Late
If you naively write your denomination into this form, you declare your membership to one of these churches and will have to pay church tax of approx. 1% of your income (more precisely: 9% of your income tax). If you don’t have any income, you don’t pay any such tax.
If you have by mistake filled in your confession but would prefer to decide on your own whether or how much you’d like to donate to your church, you will have to exit the church again by going to your local Standesamt. Depending on where you reside in Germany, you might have to pay a fee.
But be aware that you will not be a legal member of that church anymore after your exit. In 2012 the two big churches raised approximately 10.3 Billion Euros in church taxes which makes for up to 80% of their income.
Half A Million (!) German Church Tax
But now to the 442 Million from the beginning. Everyone paying taxes in Germany (and that’s everyone who even buys a bottle of milk) is paying the church due to some agreements between the Catholic Church and the German government from 1803.
The argument is that the government of that time expropriated the church of many goods and a lot of real-estate and therefore is now compensating the church for this act. Based upon a treaty between the two grand churches and the Bavarian government of 1924, there’s even a paragraph in our actual constitution ensuring that this deal is still valid.
As you can imagine, not everyone is happy about this deal from back then, as times have changed significantly and there are many different belief systems and organisations.
By the way, this money is not for any social work of the churches, like e.g. hospitals, Kindergärten or old people’s homes (which by the way are also almost completely funded by the government and not by the churches, but that’s stuff for another article).
It’s exclusively used for the wages of German Bishops (which can sum up to 8.000 EUR or even 11.000 EUR per month) including „company“- car (critics say it’s not too seldom a Mercedes, although it would be nice to have some statistics here) and indirectly their pension fund, unemployment insurance and 50% of their health insurance.
Leaving the Church and Ending Tax Payments
Leaving the church, known as Kirchenaustritt, is a bureaucratic process that involves renouncing church membership, usually costing around 30 euros.
After applying to local administrative courts with the necessary documents, people receive a leaving certificate so that they can stop paying church tax. However, complications may arise for those baptized or attending church services elsewhere.
Around 70% of church revenues in Germany stem from Kirchensteuer, amounting to approximately 12 billion euros in 2020. The process of collecting church tax is governed by tax regulations passed by religious communities and state laws, allowing them to either collect fees directly or have the state withhold them through income tax assessments.
Would You Support Something You Possibly Detest?
Now imagine that part of any purchase you make or a small percentage of your income (in the end we are talking about approximately 10 EUR per working inhabitant per year) goes to an organisation that you are not really fond of, maybe a pro-life organisation or an abortion-clinic or a pro-gay or anti-gay movement, just to name a few pretty controversial examples.
It’s one thing that the government spends taxes on projects that you might not necessarily agree to, that’s called democracy (most likely this same problem also occurs in a kingdom or dictatorship) but as the matter of what you believe in has always been very emotional and important to many of us, this is a very discussable matter.
Here is more on the grades of separation between church and state in Germany from the Smarter German blog.
Legal Matters VS Emotions
Of course, legal matters are never easy to conclude and this article surely makes no claim to be able to solve this issue in any way.
But it might spark a very interesting discussion about the obligations of a state which is a constantly changing structure created by its predecessor, or about the question of how we can deal with the fact that a lot of our money goes into projects that we might possibly massively disagree with.
Of course, tolerance is an important part of the development of our societies and our civilization, but I for example prefer acceptance over tolerance as what I accept, I like, while what I tolerate I do not.
What’s Your Opinion?
What do you think about the way the German state deals with the Catholic and Protestant churches? Or how do you deal with the fact that your government – that might be the German one if you are an expat over here – spends your money on projects that might be difficult for you to tolerate?
With these words, I wish you a Frohe Ostern (=happy holiday) – unless you belong to the 68% that most likely don’t care about the resurrection of Christ. If you are in Germany, you might at least enjoy a really long weekend as the shops and work places are closed on Good Friday and Easter Monday.l
* There are also a few smaller churches which members are obliged to pay that tax. Those are:
- The Catholic Diocese of the Old-Catholics in Germany
- The Free Churches in the Parishes of Baden, Mainz, Offenbach and Pfalz
- Unitarian Free Religious Community of Protestants
- The Jewish Parishes
By the way, in 2013 the majority of the Germans was without confession (~26 Mio.)
Is the Church Tax Pushing People Away from Christian Identity?
Having to pay church taxes in several Western European countries does not appear to be a significant factor influencing people’s identification with Christianity.
Despite the theoretical financial incentive for disaffiliation, a Pew Research Center survey across 15 Western European countries reveals no clear correlation between the existence of a church tax and the rate of secularization. In fact, countries with mandatory church taxes do not show more rapid declines in Christian identification than those without such a system.
Interestingly, people in countries with mandatory church taxes are often more likely to self-identify as Christian than people who do not have to pay the church tax.
Additionally, levels of religious observance, including beliefs in God, daily prayer, monthly attendance of religious services, and considering religion important, are comparable between countries with and without church taxes.
Therefore, the notion that church taxes are a driving force behind people distancing themselves from a religious community does not find support in this comparative analysis.
Comparative Global Perspectives
Religious funding mechanisms vary globally, and the German church tax system stands as a distinctive model with both advantages and unique challenges. Comparing it with practices in other countries offers valuable insights into the broader landscape of financing religious institutions.
In the United States, for instance, there is a clear separation of church and state, with religious organizations relying predominantly on voluntary donations from their congregations. This voluntary funding approach emphasizes individual choice but may lead to financial uncertainties for churches, impacting their ability to sustain programs and infrastructure.
Contrastingly, some Nordic countries like Sweden and Denmark employ a system where citizens voluntarily register their religious affiliation with the government. While this facilitates financial support for recognized religious groups, it lacks the mandatory nature of the German model. Citizens in these countries often choose to allocate a percentage of their income tax to their respective religious communities, ensuring financial backing for their faith.
In contrast, countries like France and the United Kingdom have largely moved away from direct state involvement in religious funding. These nations emphasize a secular approach, allocating public funds to religious organizations based on specific agreements or projects. This method aims to ensure fair distribution and avoid privileging any particular faith, promoting inclusivity in funding.
Germany’s approach of directly linking church tax to income tax offers a structured and consistent revenue stream for religious institutions. However, the mandatory nature of the system raises questions about personal freedoms and choice. Nonetheless, the German model has sustained religious organizations, allowing them to provide essential services and maintain cultural heritage.
FAQs about religious communities and church taxes
Here are some of the most frequently asked questions about paying German church tax and taxable income in Germany.
Is it mandatory to pay church tax in Germany?
Yes, church tax is mandatory tax for registered members of the German Catholic church and other religious groups in Germany. If you are a member of the Catholic or Protestant Church, you are required to pay church taxes and this is automatically deducted from your income tax.
What is the tax paid to the church called?
The tax paid to the church is commonly known as “church tax” (Kirchensteuer in German). It is a percentage of the individual’s income tax and is used to fund the activities and services of the respective religious communities.
Is church tax deductible in Germany?
Yes, church tax is deductible in Germany. Individuals who pay church tax can include it as a deductible expense when calculating their income tax. This deduction can help reduce the overall tax liability of the individual.
What is the church tax on capital gains in Germany?
Church tax on capital gains in Germany is levied on the income generated from capital investments, such as interest, dividends, and capital gains from the sale of securities. The rate of church tax on capital gains is the same as the regular church tax rate, and it is automatically withheld by financial institutions.
What is the church tax in Europe?
Church tax systems vary across Europe, and not all countries have a church tax. Germany is one of the countries that implements a church tax, but the existence and nature of church taxes differ among European nations. The tax rate may vary between 8 % and 9 % of income tax (or wages tax).
Do you need to unregister from the Catholic Church to avoid paying tax?
Yes, in Germany, individuals typically need to formally unregister from the Catholic Church to avoid paying the church tax.
Summing Up: Paying German Church Tax
So, understanding and navigating the complexities of church tax in Germany involves careful consideration of religious affiliations, tax regulations, and the process of leaving the church for those seeking exemption.
From understanding the mandatory financial obligations for specific religious affiliations to the process of unregistering and the financial nuances, I hope this article provides some valuable insights.
Contrary to assumptions, the article sheds light on the surprising disconnect between church taxes and declining Christian identification. As we navigate the legalities and emotional aspects of contributing to religious institutions, the discussion prompts reflection on the obligations of a state and the individual’s role in funding projects that may conflict with personal beliefs.
The dynamic landscape of church tax in Germany prompts a thought-provoking exploration of legal matters and emotional considerations.
If you’d like to learn more about German history and culture, join us today at SmarterGerman!