Brief definition
The Church tax is one Surcharge, collected by tax-levying religious communities. In payroll accounting, it is - if church tax liability exists - in addition to the Income tax withheld and remitted.
The basis for assessment is the respective wage tax. Depending on the federal state, the church tax generally amounts to 8 % or 9 % Income tax.
For employees, church tax affects the monthly Net wage for businesses, it is a component of income tax withholding, which must be correctly taken into account during the payroll run.
Basics
Church tax is linked to the calculated income tax deduction. Whether church tax is payable depends on liability to church tax, which is usually recorded via electronic income tax deduction characteristics.
Motto
Church tax is not a separate „gross“ value, but a surcharge that is linked to income tax.
Church tax feature in the ELStAM
The church tax liability is handled in the payroll deduction via the electronic payroll tax deduction characteristics (ELStAM) shown. In practice, particularly the Church tax feature Relevant.
- If church tax is payable, church tax will be taken into account automatically in the payroll run.
- If there is no church tax obligation, no church tax will be withheld.
Practice Note
Changes (e.g. joining or leaving the church) affect income tax deductions. Therefore, ELStAM should be updated and validated before the payroll run.
Payroll calculation
Church tax is calculated as a percentage of income tax. The applicable rate varies by federal state. It is usually 8 % or 9 %.
Reference to billing
- Basis for calculation: Income tax (determined separately depending on the type of employment income).
- Deduction: together with income tax, to the tax authorities.
- ID card: as a separate deduction in the statement.
Demarcation
Church tax and solidarity surcharge
The Solidarity Surcharge is a federal supplementary levy. Church tax is levied by religious communities. In payroll, both – if applicable – are tied to income tax.
Church tax and gross tax
The Tax gross is the basis for calculating income tax. Church tax is a surcharge derived from the calculated income tax.
Typical errors
Common causes from practice
- ELStAM not up to date Church tax feature was not adopted in time.
- Incorrect church tax rate State logic or parameters are not correctly stored in the system.
- Mixing of deduction types Church tax and solidarity surcharge are not clearly distinguished.
- Missing documentation Deviations from the previous month are not traceable later.
Checklist
Quick check: Church tax clean in the monthly cycle
- ELStAM are updated before the payroll run.
- Church tax characteristic is correctly taken into account (liability to church tax yes/no).
- The church tax rate (8 %/9 %) is correctly configured in the system.
- Deviations from the previous month are substantiated and documented.
FAQ
What is the church tax?
Church tax is a supplementary tax levied by religious communities that are entitled to levy taxes. In payroll tax deductions, it is withheld in addition to income tax, provided that church tax liability exists.
How is the church tax calculated?
The basis for calculation is the relevant income tax. Depending on the federal state, church tax is usually 8 % or 9 % of the income tax.
How does the employer know if church tax needs to be withheld?
This arises from the ELStAM, in particular from the church tax feature.
Is church tax the same as the solidarity surcharge?
No. The solidarity surcharge is a supplementary levy based on federal law. Church tax is levied by religious communities.
Conclusion
Church tax is a surcharge on income tax, provided there is an obligation to pay church tax. Up-to-date ELStAM (electronic data record for employees), correctly deposited parameters and comprehensible plausibilisation of the results are crucial for correct settlements.
Brasser Accounting Solutions GmbH is a specialised accounting service provider and part of a corporate group with Quint GmbH (tax consultancy/auditing) and Service Place Årjäng AB (Swedish tax office). BAS exclusively performs services according to § 6 No. 3 and 4 StBerG and does not provide tax or legal advice.
