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Updated : 08/12/2016

Income taxes abroad – Germany

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I'm an employee

Which income will be taxed in Germany?

  • Living in Germany for more than 6 consecutive months? You are considered "ordinarily resident" in Germany (gewöhnlicher Aufenthalt) and must pay tax on your worldwide income and property there.
  • Living in Germany for no more than 6 months? You are not considered tax resident, and pay tax only on income earned in Germany.
  • You receive income from other EU countries? Check you never pay tax twice on the same income.

How much will you pay?

What's left of your gross income in Germany after deduction of taxes?

Online tax calculator - Germany Deutsch

Income tax rates for 2015 (2016 return)

Bracket

Annual income

Rate

1

up to €8 652

0%

2

€8 653 – €53 665

14%

3

€53 666 – €254 446

42%

4

over €254 447

45%

Income tax is progressive — the more you earn, the higher your rate. The tax rate varies from 14% to 45%.

There is also a solidarity levy (Solidaritätszuschlag), equivalent to 5.5% of your income tax.

You must also pay church tax if you're affiliated to a religious community that charges it. Church tax is based on your income tax bill – 8% of your income tax in Bavaria and Baden-Württemberg, 9% in other parts of Germany.

Various deductions are allowed that may reduce the amount of tax you pay on your salary.

When and how do you pay?

Your employer will deduct the amount of tax due from your salary.You can get an idea of how much tax you will have to pay on your wages from the German Finance Ministry's interactive wage and income tax calculator Deutsch – interactive wage and income tax calculator

Your employer will also deduct your contributions to statutory social insurance schemes – pension, care, unemployment and healthcare insurance – direct from your wages.

Salary is your only source of income? — You do not have to file an annual tax return.

Want to file a return to benefit from specific tax allowances? — Send the return to the relevant tax office before the end of May of the following year.

How to appeal / complain

Your tax office (Finanzamt Deutsch ) will provide information on your rights and obligations. Detailed advice can be obtained from tax consultants or solicitors, who can also represent you.

You may challenge any decision on taxation at the local tax office (Finanzamt Deutsch ), and subsequently, if need be, take your complaint to the tax tribunal. You have 1 month to challenge a decision.

Links

German government — income tax info

Check also what your EU rights are.

I'm self-employed

Which income will be taxed in Germany?

  • Living in Germany for more than 6 consecutive months? You are considered "ordinarily resident" in Germany (gewöhnlicher Aufenthalt) and must pay tax on your worldwide income and property there.
  • Living in Germany for no more than 6 months? You are not considered tax resident, and pay tax only on income earned in Germany.
  • You receive income from other EU countries? Check you never pay tax twice on the same income.

How much will you pay?

What's left of your gross income in Germany after deduction of taxes?

Income tax rates for 2015 (2016 return)

Bracket

Annual income

Rate

1

up to €8 652

0%

2

€8 653 – €53 665

14%

3

€53 666 – €254 446

42%

4

over €254 447

45%

Income tax is progressive — the more you earn, the higher your rate. The tax rate varies from 14% to 45%. You can get an idea of how much tax you will have to pay on your wages from the German Finance Ministry's interactive wage and income tax calculator Deutsch .

There is also a solidarity levy (Solidaritätszuschlag), equivalent to 5.5% of your income tax.

You must also pay church tax if you're affiliated to a religious community that charges it. Church tax is based on your income tax bill – 8% of your income tax in Bavaria and Baden-Württemberg, 9% in other parts of Germany.

When and how do you pay?

You must make quarterly advance payments (based on your return for the previous year) to offset your expected final tax liability.

If you've just started a new business, you will have to provide the tax office with a forecast of your earnings. On the basis of that, they will caclulate the size of the advance payments you have to make.

In either case, you must file a return with the relevant tax office by the end of May of the following year.

How to appeal / complain

Your tax office Deutsch will provide information on your rights and obligations. Detailed advice can be obtained from tax consultants or solicitors, who can also represent you.

You may challenge any decision on taxation at the local tax office Deutsch and subsequently, if need be, take your complaint to the tax tribunal. You have 1 month to challenge a decision.

Links

German government — income tax info

Check also what your EU rights are.

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