German basic tax allowance 2026: €12,348 – also without residence?

The basic tax allowance (Grundfreibetrag) is the part of income on which no income tax is charged. It protects the subsistence minimum and is raised regularly. For 2026 it is €12,348, or €24,696 for jointly assessed married couples.

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What it means for the self-employed

For the self-employed, profit counts – income minus business expenses – plus other income, less insurance contributions and other deductions. If taxable income is below €12,348, no income tax is due. You still have to file a tax return every year, usually electronically via ELSTER.

Note: the allowance concerns income tax. VAT is separate – for that, the small business scheme applies.

Basic allowance without residence in Germany

If you have neither residence nor habitual abode in Germany, you have limited tax liability on your German income. Under § 50 EStG the basic allowance is then generally not granted – tax is due from the first euro.

There is a way out: on application you are treated as having unlimited tax liability under § 1(3) EStG if

• at least 90% of your total income is subject to German income tax or
• your income not taxed in Germany does not exceed the basic allowance.

You prove your foreign income with a certificate from your home country’s tax authority. For carers working almost exclusively in Germany this application often pays off. It ties in with the tax registration questionnaire, where you state your living situation.

Other values linked to the allowance

The maximum deductible maintenance for dependent relatives equals the basic allowance, so also €12,348 in 2026. More new figures: minimum wage 2026 and contribution ceilings 2026.