Tax-Free Allowance (Grundfreibetrag): The first 12,348 you earn is completely tax-free.
Progressive Zone: Income between 12,349 and 69,878 is taxed at a smoothly increasing marginal rate from 14% to 42%.
Top Tax Rate (Spitzensteuersatz): Income from 69,879 to 277,825 is taxed at a flat 42%.
Wealth Tax (Reichensteuer): Income above 277,825 is taxed at 45%.
On top of income tax, mandatory social security contributions will consume roughly 20% to 21% of your gross salary (capped at specific income ceilings):
Pension Insurance: 9.3%
Public Health Insurance: ~8.2% to 8.75% (depending on your provider's supplemental rate)
Unemployment Insurance: 1.3%
Long-Term Care Insurance: 2.3% to 2.9% (includes a 0.6% surcharge if you are over age 23 and childless)
To see how these deductions interact, here is an estimate for a single individual (Tax Class I) living in Frankfurt, earning a gross salary of €60,000 per year without church tax:
Category Annual Amount Percentage of Gross
Gross Salary 60,000 100%
Pension Insurance (9.3%) -5,580 9.3%
Health Insurance (~8.75%) -5,250 8.8%
Unemployment Insurance (1.3%) -780 1.3%
Long-Term Care Insurance -1,440 2.4%
Income Tax -8,786 14.6%
Net Take-Home Pay 38,164 ~63.6%