In this article, you'll learn which fields in the Master data and Employment tabs are particularly important, why your payroll service needs this information, and how to avoid typical follow-up questions or delays.
This overview focuses on fields that commonly raise questions. Simple fields like name, first name, or date of birth are omitted for simplicity.
Master Data
Personal data
This information uniquely identifies the employee and forms the basis for reports to authorities and social insurance carriers.
Nationality
Nationality is required for social insurance reports. For employees without German nationality, additional information may be required, such as a work permit or residence title.
Select the nationality from the dropdown list. If the employee holds dual nationality, enter the one that is relevant for their residence status in Germany.
Marital status
Marital status affects, among other things, the tax class and eligibility for certain tax allowances. Enter the current marital status. If the marital status changes during employment, the information must be updated.
Religious denomination (church tax indicator)
The religious denomination determines whether and how much church tax is withheld from the salary. The correct information can be found on the income tax certificate or in correspondence from the tax office.
If there is no church tax obligation, select the corresponding option. A missing or incorrect entry can lead to incorrect tax deductions.
Tax and social insurance data
This information is required so that payroll can be processed correctly from both a tax and social insurance perspective. Missing or incorrect values almost always lead to follow-up questions from your payroll service.
Tax identification number (Steuer-ID)
The tax ID is an 11-digit number permanently assigned to every person in Germany. It is required for the electronic income tax certificate and for registering wage tax.
You can find it on your income tax certificate, in correspondence from the tax office, or on your income tax assessment. If you can no longer find your tax ID, you can request it again from the Federal Central Tax Office (Bundeszentralamt für Steuern).
Without a tax ID, wage tax cannot be registered correctly. In this case, your payroll service must calculate wage tax using tax class VI, which results in significantly higher deductions.
Tax class
The tax class determines the amount of monthly wage tax. It is assigned by the tax office and depends on marital status:
Tax class I - single, divorced, or widowed
Tax class II - single parent
Tax class III - married (higher income)
Tax class IV - married (both earn roughly the same)
Tax class V - married (lower income)
Tax class VI - second job or missing tax ID
The correct tax class is usually retrieved automatically via ELStAM data (Elektronische Lohnsteuerabzugsmerkmale). The entry in the employee questionnaire is used for the initial setup.
Child allowances (Kinderfreibeträge)
Child allowances affect the amount of solidarity surcharge and church tax. You can find the number on your income tax certificate or in the ELStAM retrieval.
Each child is typically counted as 0.5 per parent (1.0 for joint assessment). Enter the value shown on your income tax certificate.
Parental status (Elterneigenschaft)
Whether the employee has children is relevant for the long-term care insurance surcharge. Childless employees aged 23 and over pay a higher contribution to long-term care insurance.
Indicate whether the employee has children. If so, the number of children may be relevant, as parents with multiple children under 25 pay a lower contribution rate.
Contract data
This information describes the employment relationship and forms the basis for correctly calculating salary, working hours, and social insurance contributions. You can find these fields in the Employment tab of the employee profile.
Job title (Stellenbezeichnung)
The job title describes the employee's position within the company, for example "Senior Business Developer" or "Accounting Clerk." It is used for internal assignment and may appear in documents such as employment certificates.
Job description (Tätigkeitsbezeichnung)
The job description is required for social insurance reports and describes the activity performed, for example "Sales Manager." It may differ from the job title and follows the classification system of the Federal Employment Agency (Bundesagentur für Arbeit).
Additional payments (Weitere Zahlungen)
Indicates whether additional regular compensation components have been agreed, for example allowances, benefits in kind, or capital-forming benefits. If yes, additional fields for entering the details are displayed.
Cost center / cost unit (Kostenstelle / Kostenträger)
Cost centers and cost units are used for the internal allocation of personnel costs. If your company uses cost center accounting, assign the employee to the corresponding cost center and cost unit. These values are used in payroll for booking purposes.
These fields are optional. If your company does not use cost center accounting, you can leave them empty.
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