An Increase of 252 Euros
Good news at the start of the year: The basic tax allowance (Grundfreibetrag) rises to 12,348 euros from 01.01.2026. That is 252 euros more than in 2025 (12,096 euros). For married couples with joint assessment, the amount doubles to 24,696 euros.
What Does the Basic Allowance Mean?
The basic allowance secures the tax-free subsistence level. Up to this amount, you pay no income tax on your taxable income. Only every euro above it is taxed - starting at the entry rate of 14%.
Historical Development: Basic Allowance 2015-2026
| Year | Allowance (Singles) | Allowance (Married) |
|---|---|---|
| 2015 | 8,472 € | 16,944 € |
| 2020 | 9,408 € | 18,816 € |
| 2023 | 10,908 € | 21,816 € |
| 2024 | 11,604 € | 23,208 € |
| 2025 | 12,096 € | 24,192 € |
| 2026 | 12,348 € | 24,696 € |
Since 2015, the basic allowance has risen by almost 3,900 euros - an increase of over 45%.
Example Calculations: How Much You Save in 2026
| Gross Income (Year) | Savings 2026 vs. 2025 (approx.) |
|---|---|
| 25,000 € | approx. 60 € |
| 35,000 € | approx. 100 € |
| 45,000 € | approx. 130 € |
| 55,000 € | approx. 148 € |
| 70,000 € | approx. 155 € |
Bracket Creep: Why the Adjustment Is Necessary
Without regular increases to the basic allowance, so-called bracket creep (kalte Progression) would cause salary increases that merely compensate for inflation to lead to a higher tax burden. The 2026 tariff shift aims to prevent exactly this.
Further Relief in 2026
Not only the basic allowance rises. Child benefit (Kindergeld) increases to 259 euros per child, and the child allowance (Kinderfreibetrag) climbs to 9,756 euros.
Sources: Federal Ministry of Finance - Changes 2026, Subsistence Minimum Report
Tip: Use our Net Calculator to check your new salary for 2026 and compare savings versus 2025.