Kindergeld rises to 267 Euro in 2027; till duty starts above 100,000 Euro

Employees, families and small employers face a bundle of 2027 tax changes at different stages of enactment. The Einkommensteuerreformgesetz 2027 stands as a government draft heard in the Bundestag finance committee; the cash-register law is before the Bundesrat; the Frühstartrente and the Jahressteuergesetz 2026 are adopted; the application-free Kindergeld is promulgated.

The 2027 income-tax reform draft implements parts of the coalition committee's 2 July 2026 tax package, aiming to strengthen labour supply and growth while adding fairness through counter-financing. It raises the Grund- and Kinderfreibeträge and reforms the Einkommensteuertarif including the tax-free subsistence level, lifts the maximum eligible base wage for tax-favoured Sunday and holiday bonuses, and raises the Arbeitnehmer-Pauschbetrag. Kindergeld rises from 259 Euro per monthDstv to 267 Euro from 2027Dstv and to 272 Euro from 2028Dstv. A higher Reichensteuersatz serves as counter-financing. On the restrictive side, the deductible percentage and the maximum relief for Handwerkerleistungen fall. The uniform flat tax on Mini-Jobs rises from 2 percent to 5 percentDstv, and a special trade-tax apportionment standard for data-centre operators is introduced.

The cash-register law introduces a till obligation from 1 January 2027Dstv for businesses with total turnover above 100,000 EuroDstv, flanked by a notification duty, fines and tax-criminal provisions. Hardship relief is available, and an empowerment clause allows a Kassenpflicht-Ausnahmeverordnung, for which the BMF has tabled a first discussion draft. From 1 January 2028 the paper receipt duty becomes a duty to make receipts availableDstvDstv. Further measures change tax criminal law against evasion, give the tax office of the district of activity a new investigation competence, remove the discretion on Verzögerungsgeld and introduce a Verlagerungsgeld.

The Frühstartrente starts state-funded capital-covered old-age provision in childhood: state contributions begin once a child turns six and continue steadily, so that small regular contributions build assets over the long term for every child, regardless of the parents' initiative, means or financial literacy.

The adopted Jahressteuergesetz 2026 collects mostly technical individual measures. It eases the procedure for withholding relief on licence payments under § 50a EStG via § 50c EStG, raises the registration threshold of the Forschungszulagengesetz, adjusts the interest rate for full interest under § 233a AO, and regulates AI use by the tax authorities under § 29c AO. Children resident in the EU or EEA receive the full Kinderfreibeträge and the Ausbildungsfreibetrag under § 32 Abs. 6 Satz 4 and § 33a Abs. 2 Satz 2 EStG, and nationals of EU and EEA states plus Switzerland hold a Kindergeld claim under § 62 Abs. 1a EStG. The VAT grouping under § 2 UStG is re-regulated, with a declaration procedure to settle unintended Organschaft relationships.

For families the most immediate relief is procedural: after a birth the Familienkasse may dispense with an application for tax-law Kindergeld. Data transmissions to the Familienkasse are expanded so families need not repeat officially known information, following the Once-Only principle, while unjustified payments are curbed and the grant process is debureaucratised. The law was promulgated on 20 October 2026 as BGBl. I 2026, Nr. 307, after passing the Bundestag and Bundesrat in the summer and autumn.

Legal basis: Einkommensteuerreformgesetz 2027 (government draft); Gesetz zur Fortentwicklung von Kassenaufzeichnungen; Gesetz zur Einführung einer Frühstartrente; Jahressteuergesetz 2026 including §§ 50c, 62 Abs. 1a, 32 Abs. 6, 33a Abs. 2 and 66 EStG, § 2 UStG and §§ 29c and 233a AO; Gesetz zur Einführung eines antragslosen Kindergeldes (BGBl. I 2026, Nr. 307).