Have you started your first job or a paid internship? Then sooner or later, a specific term will appear on your payslip: Lohnsteuer (Wage Tax). But what exactly is it? Why is it deducted from your salary every month – and what happens to this money?
In this article, you will get a simple overview:
What is Lohnsteuer, how is it calculated, what do tax tables have to do with it – and why you often get money back at the end of the year.
What is Lohnsteuer?
Lohnsteuer (Wage Tax) is an advance payment on your Einkommensteuer (Income Tax). It is transferred directly by your employer to the Finanzamt every month – before you even receive your salary.
Therefore, you don't have to take care of it yourself – but you should understand how it works. Because: If you pay too much Lohnsteuer, you get it back at the end of the year via a tax return.
How is Lohnsteuer calculated?
The amount of your Lohnsteuer depends on:
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your gross salary
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your Steuerklasse (Tax Class)
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whether you have children
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whether you are a member of a church (Church Tax)
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tax-free allowances or other characteristics (e.g. in the case of a severe disability)
Simply put: The higher your income and the more "unfavourable" your tax class, the more Lohnsteuer is due.
What is the Lohnsteuertabelle?
The Lohnsteuertabelle (Wage Tax Table) is an overview that shows how much Lohnsteuer applies to a certain gross salary – depending on the tax class. It is regularly adjusted by the Bundesfinanzministerium (Federal Ministry of Finance) and forms the basis for payroll accounting.
In practice, your employer usually calculates the Lohnsteuer digitally using software based on the current tables.
How does a Lohnsteuerrechner help me?
A Lohnsteuerrechner (Wage Tax Calculator) is a free online tool that helps you estimate how much net income remains from your gross salary. You enter your salary, your tax class, and any other relevant information – and receive an initial orientation.
Recommended:
Official calculator from the Bundesfinanzministerium: bmf-steuerrechner.de
Alternatives: brutto-netto-rechner.info, lohnsteuerrechner.net
What happens at the end of the year?
The monthly Lohnsteuer is an advance payment – but it can differ from your actual tax liability. This is why an Einkommensteuererklärung (Income Tax Return) is worthwhile for many career starters:
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If, for example, you only worked for half the year
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If you have high business expenses (e.g. travel costs, laptop, work equipment)
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If you claim special expenses or insurance
In these cases, you often get several hundred euros back – completely legally.
Lohnsteuer is mandatory – but you have a say
Even though your employer handles everything: it pays to understand Lohnsteuer. With knowledge about tax classes, allowances, and calculators, you can get more out of your salary – and know how to approach your first tax year cleverly.
**Please note
**This article serves as general information and was carefully created by the Lexo.Tax editorial team. Personal tax advice can only be provided within the framework of a membership with Lexo.Tax – and exclusively within the legally permissible scope according to § 4 Nr. 11 StBerG (Tax Consultancy Act).