Are you a pupil or student and receive BAföG? Here you can find out whether the grant is relevant for tax purposes.
- Short and to the point
- What is BAföG?
- BAföG in your tax return
- BaföG repayment - can it be tax-deductible?
- Aufstiegs-BAföG: Upgrading BAföG
Short and to the point
BAföG funding is a tax-exempt education allowance and serves to finance your livelihood. Therefore, you do not have to enter BAföG in your tax return.
What is BAföG?
The Federal Training Assistance Act (BAföG) aims to support the training of young people regardless of their social and economic position. The prerequisite is German citizenship or a status with the prospect of staying.
Maximum funding period:
- Pupils and students in general: until the age of 30.
- In a Master's programme: up to the age of 35
The exact amount depends on your own income and the income of your parents or spouse. Existing assets are also taken into account.
If you are a student, you receive BAföG as a full grant. This means that you do not have to pay the amount back. If you are a student, half of your BAföG is a grant and the other half is an interest-free loan. You have to repay this portion after you graduate.
BAföG in your tax return
As a training grant, BAföG is a tax-free benefit. BAföG serves to finance your living expenses. It is not a salary for training and is not taxable income - and only this is relevant for your tax return. You therefore do not have to declare BAföG in your tax return.
BAföG repayment - can it be tax-deductible?
When you start working for tax purposes, you may wonder whether you can also deduct the repayment. However, this is not possible.
Only interest costs on loans can be claimed. Since as a student you only have to repay half of the BAföG and this portion is interest-free, you cannot deduct it.
Interest may only be charged on the outstanding amount if you are in arrears. If this is the case for you, you can claim this interest in your tax return. Here we explain how to do this.
Aufstiegs-BAföG: Upgrading BAföG
The Aufstiegs-BAföG, formerly called the Meister-BAföG, is different from the BAföG for students or pupils.
The Aufstiegs-BAföG supports you if you are preparing for a further education qualification such as master craftsman.
In addition to the 40% grant, you may be able to take out a low-interest loan with Aufstiegs-BAföG. If this is the case, you can deduct the interest as income-related expenses in the year of payment. You can find more information about this here.