Increase of Social Security Contribution and Compulsory Insurance Ceilings Planned for January 1, 2024

According to a draft bill of the Federal Ministry of Labor and Social Affairs, the ceilings for social security contributions and compulsory insurance in statutory health and pension insurance are to increase as of January 1, 2024.

The values of the social security calculation parameters are updated annually and adjusted to income trends.

According to the Ministry’s draft, the following changes are planned as of January 1, 2024:

The annual income ceiling for statutory health insurance, also known as the compulsory insurance limit, will rise to EUR 69,300 (2023: EUR 66,600) per year or EUR 5,775 (2023: EUR 5,550) per month. The compulsory insurance limit is decisive for whether employees can opt for private health insurance.

The income ceiling for statutory health and long-term care insurance is to be EUR 62,100 per year (2023: EUR 59,850) or EUR 5,175 per month (2023: EUR 4,987.50).

In the general statutory pension insurance, the income ceiling is to increase to EUR 90,600 (2023: EUR 87,600) per year or EUR 7,550 (2023: EUR 7,300) per month, while the income ceiling (East) in the general pension insurance is to increase to EUR 89,400 (2023: EUR per year or EUR 7,450 (2023: EUR 7,100) per month.

The income ceiling determines the amount up to which income is subject to social security contributions in the respective insurance scheme.

With the increase in the income ceiling, the burden on employers, as well as on high-income employees, will rise.

The draft bill for the respective ordinance has yet to be passed by the German government.

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