Income Splitting for Couples: Advantages and Disadvantages 2025
Auf einen Blick
Income splitting (Ehegattensplitting) saves taxes when incomes differ. We examine the pros and cons and the political debate around abolition.
Income Splitting 2025: How the Mechanism Works
Income splitting (Ehegattensplitting) is one of the most important tax advantages for married couples and registered partnerships in Germany. The principle is simple: With joint assessment, the combined taxable income is halved, the income tax rate is applied to this half, and the resulting tax is doubled. Due to progressive taxation, a benefit arises whenever the partners have different income levels.
Calculation Example
Partner A earns 60,000 euros and Partner B earns 0 euros (e.g., parental leave). Without splitting, Partner A would pay approx. 15,400 euros in income tax. With splitting: 60,000 / 2 = 30,000 euros, tax on that approx. 5,200 euros x 2 = 10,400 euros. Savings: approx. 5,000 euros.
Tax Savings for Various Income Combinations
| Partner A | Partner B | Tax without Splitting | Tax with Splitting | Savings/Year |
|---|---|---|---|---|
| 60,000 euros | 0 euros | approx. 15,400 euros | approx. 10,400 euros | approx. 5,000 euros |
| 60,000 euros | 20,000 euros | approx. 17,500 euros | approx. 14,800 euros | approx. 2,700 euros |
| 60,000 euros | 40,000 euros | approx. 23,800 euros | approx. 22,600 euros | approx. 1,200 euros |
| 60,000 euros | 60,000 euros | approx. 30,800 euros | approx. 30,800 euros | 0 euros |
| 80,000 euros | 30,000 euros | approx. 27,200 euros | approx. 24,200 euros | approx. 3,000 euros |
Key insight: The larger the income difference, the higher the splitting benefit. If both earn the same, splitting provides no advantage.
The Disadvantages: The Second-Earner Trap
Income splitting has a downside often referred to as the second-earner trap (Zweitverdiener-Falle). When one partner earns significantly less (typically in tax class 5), disproportionately high wage tax is withheld from their salary. Studies by DIW show that splitting reduces women's labor force participation by 3-5 percentage points.
Political Discussion and Reform Outlook
- Gender equality: Splitting favors single-earner marriages and creates negative work incentives for the lower-earning partner.
- Cost to the state: Income splitting costs the treasury approx. 20-25 billion euros annually.
- Reform models: Individual taxation, real splitting, or a combination of basic allowance transfer and family support are being discussed.
The planned abolition of tax classes 3/5 in favor of the factor method (4/4 with factor) does not change the splitting itself - it only provides a fairer monthly wage tax distribution.
Sources: EStG Section 26b, Section 32a Para. 5; DIW Weekly Report on labor force participation; BMF Data Collection 2025
Calculate your splitting advantage: Determine your personal savings through joint assessment in the Gross-Net Calculator - compare tax class 3/5 with 4/4.
Sources & References (2026)
All calculations are based on the official legal provisions for 2026. Despite careful research, no guarantee is given for correctness. This calculator does not replace professional tax advice.