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Elterngeld: How Germany is changing the rules around parental allowance

Rachel Stern
Rachel Stern - [email protected]
Elterngeld: How Germany is changing the rules around parental allowance
A dad on parental leave with his baby at the playground in Hanover. Photo: picture alliance/dpa | Marco Rauch

As of April 2024, Germany has capped both the limit to receiving Elterngeld, and the number of months two parents can receive the payment at the same time.

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What changes are being made to Elterngeld?

The income limit for Elterngeld (parental allowance) is falling. Couples whose children were born starting April 1st are allowed to earn up to a combined total of €200,000 per year in taxable income.

Previously, the limit was a taxable annual income of €300,000. The same applies to single parents, who had their limit capped at €250,000 before.

The reduction, part of Germany's trimmed down budget for 2024, was originally to be reduced to €150,000 and then pushed upwards amid protests that it would affect too many families and disadvantage working women in particular.

READ ALSO: Everything that changes for families in Germany in 2024

Germany’s Ministry for Family Affairs has said that it expects that around 7,000 couples will be affected by the reduction, or about 0.5 percent. 

Starting on April 1st, 2025, the income threshold will fall again for couples and single parents alike to €175,000.

The Family Ministry added that "only a small number of single parents will be affected by the reduction in the income threshold".

What will change when receiving parental allowance at the same time? 

As of April 1st, parents are no longer able to take parental leave (Elternzeit) together for as long and receive Elterngeld at the same time.

Although the previous 14 months of standard Elterngeld will remain, from April it will only be possible to stay at home with your partner for one month of this and receive Elterngeld at the same time - and only in the first year of their child's life.

There will be exceptions for multiple births, premature babies and children with disabilities.

Previously it was possible for couples to take up to seven simultaneous months of paid parental leave.

READ ALSO: Everything that changes in April 2024 in Germany

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Photo: Pixabay

How are the changes being received by those affected?

According to a recent survey from Germany's Ministry of Family Affairs, almost two-thirds of the 1,057 respondents think that the lowering of the income limit is a step in the right direction. Even among potentially affected groups - such as families or those under the age of 40 - more people think the reduction is right than wrong.

Yet not as many were in favour of reducing the simultaneous receipt of Elterngeld: 45 percent of respondents say they agree with the change, although almost a third stated that they were unable to judge it,  revealing a relatively high level of uncertainty.

What exactly is Elterngeld?

Elterngeld is a state financial benefit: it is intended to enable parents to take time for their children once they enter the world. The amount which new parents receive, however, depends on the income before the birth and the loss of income afterwards. 

Parents with higher incomes receive up to 65 percent of their previous income, parents with lower incomes can receive up to 100 percent.

The amount of Elterngeld paid out varies quite a bit, but you can receive a minimum of €300 per month and a maximum of €1,800 per month.

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How many people receive Elterngeld?

Current figures from the Germany's Statistical Office show that 1.8 million people in Germany applied for parental allowance in 2023. That is fewer than in the previous year - a dip of 4.3 percent. 

Of the 1.8 million recipients, 1.3 million were women.

How do you receive Elterngeld?

Firstly, the benefit - as with Kindergeld (monthly child allowance) - needs to be applied for. In some states, this is also possible online via the ElterngeldDigital portal. Mothers and fathers can use the digital parental allowance calculator in order to figure out their entitlement.

READ ALSO: What benefits are you entitled to if you have children in Germany?

 

 

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