Annual income tax adjustment

The annual wage tax adjustment can be carried out by the employer at the end of the current calendar year with the December wage statement in order to reimburse the employee for any difference between the wage tax actually paid during the calendar year and the annual wage tax ( Section 42b (1) sentence 1 EStG) .

Differentiation from the income tax return

The annual income tax adjustment must be distinguished from the income tax return, which the employee can submit to the tax office after the end of the calendar year and which must also submit under certain conditions. The correction of the wage tax deduction on the annual wage tax serves to reduce the number of cases in which it is advantageous for the employee to file an income tax return.

Employer's obligation

The employer is obliged to carry out the annual wage tax adjustment if on 31.12. of the compensation year employs at least ten employees, otherwise he is entitled to do so ( Section 42b (1) sentence 2 EStG).

Exclusions for individual employees

If the employer carries out the annual wage tax adjustment, he has to check with each individual employee whether all requirements are met. These are mostly facts in which there is an obligation to submit an income tax return. Due to the following exclusions, the annual wage tax adjustment may not be carried out by the employer for individual employees ( Section 42b (1) sentence 3 EStG):

The employee is not subject to unlimited income tax

The employee has applied for no annual wage tax adjustment to be carried out

The employee had to be taxed for the equalization year or part of the equalization year according to wage tax classes V or VI

The employee had to be taxed for part of the equalization year according to income tax classes II, III or IV

The factor method was used

When calculating wage tax, an allowance or an additional amount had to be taken into account

The employee was to be taxed in the equalization year according to the general and the special wage tax table

the employee received in the compensation year:

Short-time work allowance , including seasonal short-time work allowance
Bad weather money
Winter loss allowance
Grant to maternity pay
Subsidy for employment bans
Compensation for loss of earnings according to the Infection Protection Act
Foreign income from employment under the terms of a double taxation agreement fall

In the payroll account was entered at least once an interruption (uppercase U).

The employee was only employed by the employer for part of the compensation year.

For the employee, the additional health insurance contribution has changed in the compensation year .

Sample calculations

Example 1 - change in salary

Change in salary from July
Tax class I, church tax 9%, no child allowances, childless, year of birth 1960, tariff 2012

Month (s)	BMG	LSt	Solos	KiSt
Jan – Jun	2,000.00	217.08	11.93	19.53
Jul – Dec	3,000.00	468.33	25.75	42.14
total	30,000.00	4,112.46	226.08	370.02

LStJA	BMG	LSt	Solos	KiSt
Deduction in the current year	30,000.00	4,112.46	226.08	370.02
Deduction for an annual basis	30,000.00	4,052.00	222.86	364.68
Reimbursement at the LStJA	-	60.46	3.22	5.34

Example 2 - one-time payment

Constant salary, one-off payments in June and November
Tax class I, church tax 9%, no child allowances, childless, year of birth 1960, tariff 2012

Month (s)	BMG	LSt	Solos	KiSt
Jan – May	2,000.00	217.08	11.93	19.53
Jun	4,000.00	686.08	37.73	61.64
Jul – Oct	2,000.00	217.08	11.93	19.53
Nov	4,000.00	686.08	37.73	61.64
Dec	2,000.00	217.08	11.93	19.53
total	28,000.00	3,542.96	194.76	318.78

LStJA	BMG	LSt	Solos	KiSt
Deduction in the current year	28,000.00	3,542.96	194.76	318.78
Deduction for an annual basis	28,000.00	3,556.00	195.58	320.04
Theoretical additional amount for the LStJA	-	13.04	0.82	1.26

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