In its judgment of 10 December 2020, the Münster Tax Court ruled that the three-month waiting period for EU nationals relocating to Germany does not apply if an entitlement to child benefit already existed before they established residence in Germany.
In July 2020, the plaintiff moved from Bulgaria to Germany with her two children. Her husband, the children's father, had already been living in Germany since late 2019. He was employed there on a full-time basis, while the plaintiff – his wife – was not gainfully employed herself.
The family benefits office rejected the plaintiff's child benefit application for the first three months (July to September 2020) on the grounds that she had not earned any ongoing domestic income. From October 2020 onwards, she received child benefit.
The competent senate of the Münster Tax Court also granted the plaintiff child benefit for the months of July to September 2020. The three-month waiting period for non-employed EU nationals from the date of establishing residence in Germany did not apply in this case. A fictitious family residence pursuant to Art. 67 sentence 1 of EC Regulation No. 883/2004 is sufficient to establish residence. The plaintiff had already had such a fictitious residence before moving to Germany because her husband had lived and worked there. This interpretation also corresponds to the purpose of the waiting period, which is to protect the German social system from inappropriate use and to prevent child benefit from creating an incentive to move to Germany. This purpose cannot be served if a domestic child benefit entitlement already existed prior to relocation. The plaintiff's entitlement is also not limited to differential child benefit, because Germany has primary jurisdiction due to her husband's gainful employment, and therefore no Bulgarian child benefit entitlement exists.
The senate has allowed an appeal on points of law to the BFH on the grounds of fundamental significance.
Frequently asked questions
Frequently asked questions
Does the three-month child benefit waiting period also apply to EU nationals who have recently moved to Germany?
According to the ruling of the FG Münster dated 10 December 2020, the three-month waiting period for non-employed EU nationals does not apply if an entitlement to child benefit in Germany already existed before the establishment of domestic residence. In such cases, the Familienkasse may not refuse child benefit for the first three months. An appeal to the BFH was admitted due to the fundamental significance of the matter.
What is a fictitious family residence under Art. 67 EC Regulation 883/2004?
A fictitious family residence exists when a family member already lives and works in an EU member state, so that the remaining family members are treated as if they also resided there. Under German child benefit law, this is sufficient to establish residence. As a result, a claim to child benefit can arise even before the family actually moves to Germany.
What is the purpose behind the three-month waiting period for child benefit (Kindergeld)?
The waiting period is intended to protect the German social system from inappropriate use and to prevent child benefit from creating an incentive to move to Germany. However, this purpose does not apply if a domestic child benefit entitlement already existed prior to relocation, for example because one parent is gainfully employed in Germany.
For EU cases, is the entitlement limited to differential child benefit only?
No, the entitlement is not limited to differential child benefit if Germany has primary jurisdiction. If one parent is gainfully employed in Germany and no separate child benefit entitlement exists in the home country (e.g. Bulgaria), the full German child benefit is paid. The order of jurisdiction is governed by EC Regulation 883/2004.
Who received child benefits in the FG Münster case despite not being employed?
A Bulgarian mother who moved to Germany in July 2020 with her children to join her husband, who was already employed there, received child benefits for the first three months after relocation even though she was not employed herself. The decisive factor was that her husband's residence and employment had already established a fictitious family residence in Germany prior to her move.