Germany has introduced a new minimum wage at €8.50 per hour, effective as of the 1st January 2015. If the legal specifications for minimum wages are not taken into consideration, the minimum wage will be used as a basis for calculating social insurance contributions in the case of the statutory pension insurance carrying out an audit.
The calculation of the minimum wage to be paid is influenced by various criteria, such as trade agreement, skilled or unskilled worker, and scope of duties. For this reason, each employer should proof staff wages accordingly.
The new amounts have recently been approved and are retroactive with effect from 1st January 2015.
The following changes have come into effect:
| Basic Tax-Free Allowance |
Increase of EUR 118 backdated to 1st January 2015 from EUR 8.354 to EUR 8.472 Further increase of EUR 180 as from 1st January 2016 to EUR 8.652 |
Child Tax-Free Allowance |
Increase of EUR 144 backdated to 1st January 2015 from EUR 7.008 to EUR 7.152 Further increase of EUR 96 as from 1st January 2016 to EUR 7.248 |
| Child Allowance |
Increase of EUR 4 backdated to 1st January 2015 from EUR 184 to EUR 188 monthly (for first and second child) Increase of EUR 4 backdated to 1st January 2015 from EUR 190 to EUR 194 monthly (for third child) Increase of EUR 4 backdated to 1st January 2015 from EUR 215 to EUR 219 monthly (for fourth and further children) Further increase of EUR 2 monthly per child as from 1st January 2016 |
Child Supplement |
The child supplement will benefit parents who can cover their own needs in principle by earned income, but do not have sufficient financial resources to meet the needs of their children. Increase of EUR 20 monthly as from 1st July 2016 from EUR 140 to EUR 160 monthly |
