Tax Deductible Health Insurance Costs In Germany [2024 English Guide]

Key takeaways

• You can deduct health and long-term care insurance costs from the taxes.
• Only the health insurance contributions made for the basic coverage are tax-deductible.
• Long-term care insurance contributions are also tax-deductible in Germany.
• The insurance costs you can deduct from taxes are limited to 1900 € for employed people and 2800 € for self-employed people as of 2024.
• You can claim medical expenses as extraordinary expenses on the tax return. However, they must exceed the reasonable burden amount calculated by the tax office.

This is how you do it

• If possible, bundle all the expensive medical treatments in the same year. It’ll increase the probability of exceeding the reasonable burden amount.
• Private health insurance companies issue letters summarizing tax-deductible costs. Use this information to enter the health insurance costs while filing the tax return.
• Use tax software programs to file income tax returns efficiently and correctly. We recommend the following tax software: SteuerGo*, Wundertax*, and Smartsteuer*.

Table of Contents

Are health insurance contributions tax deductible in Germany?

Yes, both private and public health insurance contributions are tax-deductible in Germany (Income Tax Act, Section 10 EStG). However, only the health insurance costs related to the basic health insurance services are tax deductible. 

The private health insurance company issues a letter summarizing the costs you can deduct. So you don’t have to calculate them manually. 

Tax-deductible health insurance costs

You can deduct the following health insurance costs from taxes.

• Contributions related to the basic health insurance services (not to be confused with the private health insurance’s basic tariff).
• Compulsory long-term nursing care insurance
• Medical treatment costs that are not covered by your health insurance plan.
• You can also deduct your family members’ compulsory health and nursing care insurance costs if you pay them.

NOTE: The tax office has set a maximum limit on the insurance costs you can deduct. The tax authorities don’t consider the costs above that limit for tax purposes.

Health insurance costs that are not tax-deductible

Any services not considered basic health insurance services are excluded from tax deductions. For example, 

• private rooms in the hospital,
• alternate medicines,
• chief physician, 
• daily sickness benefits insurance, etc.

How much health insurance costs can you deduct from taxes?

The tax office (Finanzamt) has set a limit on the insurance costs you can deduct from your taxes. The limit includes health insurance costs as well as the cost of other types of insurance, such as unemployment, accident, etc.

The table below summarizes the maximum tax-deductible insurance costs as of 2024.

	Employed, Student, Retired, Civil Servant	Self-employed
Single	1900 €	2800 €
Married couples filing joint tax return	3800 € (both are employed)	5600 € (both are self-employed)

The maximum limit applies to both spouses individually. So, if you are employed and your partner is self-employed, the limit will be 4700 € (1900 + 2800).

Usually, you exceed the limit with basic health insurance and nursing care insurance contributions.

Can you deduct medical expenses from your income tax return?

Yes, you can deduct medical costs not covered in health insurance from your income tax return. You file such costs as extraordinary expenses in the tax return.

However, the tax office considers the medical expenses only if they are medically necessary and exceed the reasonable burden (Zumutbare Belastung). The amount the tax office considers a reasonable burden depends on your income, marital status, and the number of children.

How does the tax office calculate a reasonable burden amount?

The table below shows what percentage of income is considered a reasonable burden. Only the medical costs that exceed the reasonable burden are tax deductible.

	Income up to €15,340	Income from €15,340 to €51,130	Income over €51,130
Without children
Basic tariff / single	5%	6%	7%
Splitting tariff / married	4%	5%	6%
With children
One or two children	2%	3%	4%
Three or more children	1%	1%	2%

The tax authorities consider GdE income to calculate a reasonable burden. GdE income is the gross income minus the income-related expenses, age relief amount, the allowance for farmers and foresters, and the allowance for single parents ( Section 2 Paragraph 3 EStG ).

Example

Suppose you are single with no child and earn 50k € gross annually. You don’t get any of the above-mentioned allowances.

You can deduct the flat rate for income-related expenses of 1230 € (as of 2024) from your gross income. Thus, your GdE income is 48,770 € (50k-1230).

	GdE income	48,770€ (50,000 – 1230)
Reasonable burden	5 % of income share up to 15,340€	767 € (5% of 15430)
	6 % of income share over 15,340€ to 51,130€ (48,770 – 15,340)	2,005.80€ (6% of 33,430)
	Total reasonable burden (rounded)	2,772 € (767 + 2005.8)

Suppose your medical expense was 4000 €. The tax office will deduct the reasonable burden, i.e., 2772€ from the medical costs to get the tax-deductible amount.

Hence, you can deduct 1228 € (4k – 2772 €) from taxes.

You can also use the tax office calculator to calculate the tax-deductible amount.

The tax office deducts the reasonable burden from your medical expenses and deducts the rest from your taxes.

TIP: If you are expecting expensive medical treatments in the future, try to bundle them in the same year. This way you increase the probability of exceeding the reasonable burden

How do you claim health insurance expenses in your tax return?

Depending on what costs you want to claim, you must fill out different tax forms. The table below summarizes the tax forms you must complete in different cases.

Claiming health insurance costs for	Tax form
Yourself	Appendix: Pension expenses (Anlage Vorsorge­aufwand)
Your children (entitled to child benefit).	Appendix: Child (Anlage Kind). You must fill out a separate form for each child.
Your spouse and children (NOT entitled to child benefit)	Appendix: Preventive care expenses (Anlage Vorsorgeaufwand)
Separated or divorced spouses.	Appendix: U (Anlage U)
Claiming medical expenses	Appendix: Extraordinary expenses (Anlage Außer­gewöhnliche Belastung)

If you are insured by statutory health insurance, you don’t have to provide proof of insurance contributions to the tax office. Your employer or the public health insurer will send it to the tax office electronically.

You can also use one of the tax software to file the income tax return. The tax programs are also available in English. It translates the complex tax language into easy-to-understand questions.

The tax programs we find best are Wundertax*, SteuerGo*, and Smartsteuer*.

FAQ

How do private health insurance providers calculate the tax-deductible amount?

The private health insurance companies calculate the tax-deductible amount in accordance with the “Health Insurance Contribution Share Determination Ordinance (KVBEVO).” 

KVBEVO is “Krankenversicherungsbeitragsanteil-Ermittlungsverordnung” in German.

As a rule of thumb, the tax authorities consider around 80% of the health insurance contributions for tax purposes. You don’t have to calculate the tax-deductible health insurance amount yourself. Your private health insurance provider will do it for you.

The insurer will send you a letter mentioning the contributions you can declare in your tax return. The letter also mentions the services that are considered in basic coverage.

How do private health insurance deductibles affect taxation?

You cannot claim health insurance deductibles from taxes in Germany (Ruling of Federal Finance Court).

Additionally, health insurance deductible reduces the health insurance costs. Hence, reducing the amount you can claim in the tax return.

Many private health insurance companies offer bonuses or refunds if you don’t claim insurance benefits for the whole year. You must also declare such bonuses or refunds in your income tax return.

These health insurance refunds also reduce the tax-deductible amount. 

Are employer contributions to health insurance tax-free in Germany?

Yes, the employer’s contributions to the health insurance premiums are tax-free. You must mention the employer’s contribution to health insurance in your tax.

References

• https://www.allianz.de/gesundheit/private-krankenversicherung/steuern/
• https://www.tk.de/techniker/leistungen-und-mitgliedschaft/informationen-versicherte/beitraege-beitragssaetze/haeufige-fragen-zu-den-tk-beitraegen/steuerentlastung-beitrag-absetzen-2009008
• https://www.privat-patienten.de/beitraege/kann-ich-pkv-beitraege-von-der-steuer-absetzen/