Claiming tax back

26 posts in this topic

Posted

I've been told that you can claim tax back from the German government at - I presume! - the end of the tax year. One example that was given to me is that it's possible, if you're flying to your home EU country for a few days, to claim the cost of the flight back. Now that sounds pretty unbelievable to me. Is there any truth to it?

What else can you claim back? Is there a website where I can see more details? And finally, what's the process for claiming tax back (e.g. time of year, forms vs. internet, from whom do you claim it back, what documents are required, how long does it take, etc.).

Thanks!

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Posted

Er why would you claim tax back in Germany when you have your location down as the UK?

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Posted

Because I am planning to move to Germany to work. I'm calculating in advance the amount that will be deducted from my salary each year so that it's not a shock to me when I get my first pay check. I would also like to know what things are tax-deductable in Germany so that I know what my total net earning potential is and can budget accordingly.

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Posted

I would say tha tthe best way to budget is to assume that you will not get any tax back, and run with it.

Then, if you are lucky enough to be able to get some cash out of the cash-grabbing barstewards Finanzamt, it'll be more of a pleasant surprise than anything.

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Posted

I agree with you robinson100. But I'd still like to know (or at least have a rough idea) of the types of things that might be tax-deductable. Anything I get back goes towards paying back a college loan; but I still would like to know. Any ideas where I can see a list of tax-deductables, or a list of tax credits?

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Posted

Please be advised that you will probably need to pay for a tax advisor. The system in Germany is so unfathomable even to those who speak the lingo the chances of you being able to fill out your declaration correctly and/or to your advantage without professional help are slim. There is a game to be played but it seems accessible only to those in the know. Even if you contact the Finanzamt directly you get no help to open questions only to specific questions that you can only ask once you are an expert... filling out our tax declaration was and still is an an(nu)al pain in the butt.

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Posted

Thanks featherlight.

Two questions:

1) Is it necessary to fill out a tax return if you're employed (rather than an employer)? Just wondering, because I was told that taxes are deducted automatically.

2) How much does it cost to hire a tax advisor? Is it recommended to get one at the end of the year, or to stay in contact with one throughout the year?

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Posted

1) yes, if you want to stand a chance in hell of getting any money back! :)

2) I guess prices vary, and there is also the opportunity to use a "Steuerverien" (I think it´s called), which might be cheaper.

My forms for 2010 were farily simple to fill out and the cost óf hiring a Steuerberaterin was about €230, just to give you a rough idea...

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Posted

As others have suggested; tax can be something of a game in Germany. Firstly the Finanzamt (Tax Authority) takes as much as possible from you and then you employ tax advisors to get as much back as possible.

There are so many different situations between different individuals or families it's pretty well impossible to calculate in advance.

As has been said here and discussed at length in other Tax discussions here - you can work out an idea of how much tax you will pay per month, there are links and lots of advice on the forum for this. Also don't forget church tax (if you're not religious make sure you tell your employer otherwise you'll have to pay it), re-unification tax (which was supposed to be a 10-year tax but seems to have continued), protection against unemployment tax, oh yes - health insurance too, then pension contributions .... did I forget any?

Basically, if you are a single person (Tax Class 1) you can expect to 'lose' almost 50% from top to bottom of your payslip.

Of course marriage and children will make a big difference for someone.

I haven't heard of claiming back trips 'home', but I never tried.

There are possibilities to claim back an amount for travelling to and from work.

There are also 'home office' possibilities.

There are also possibilities for claiming other expenses, but again it depends upon individual circumstances.

It really is best to assume the worst, then employ a tax specialist to help you at the end of the tax year.

It's also worth noting that tax specialists do generally work 'for' you, by which I mean they will do everything possible to get as much as possible for you as their fees are often dependent upon how much they back for you.

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Posted

It's also worth noting that tax specialists do generally work 'for' you, by which I mean they will do everything possible to get as much as possible for you as their fees are often dependent upon how much they back for you.

Ah, that's good to know. I'd hate to pay €200 to a tax advisor only to have him/her get me back €50!

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Posted

Well, there is a basic fee, but the overall bill will include some kind of percentage of the amount claimed back.

Also; don't forget that any amounts you can 'claim' are actaully amounts that reduce your overall tax liability, which in turn help calculate any rebate, but that's the same in the UK.

Edit: One final piece of advice is to keep all receipts, even postage ... everything. Then give them all to the tax specialist and let him (or her) decide if they are useful or not. If your job or move from the UK includes relocation this is a very touchy subject, or at least it was for my move.

Nobody told me that a relocation payment, which is usually paid outside of tax in the UK is taxed in GErmany.

Yes, I lost half of my relocation payment.

But then I had massive costs in setting up a rented apartment here, buying a kitchen, all light fittings ... etc ... so my tax advisor eventually worked wonders to get a massive amount of my relocation taxation back.

There are whole sections of tax law dedicated to what may or may not be claimed back regarding apartment removals.

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Posted

I believe the "deductions for flights home" thing you say you've heard about refers to the doppelte Haushaltsführung (dual household allowance). If you relocate to take on a new job and your spouse stays behind in your previous household, you can deduct regular trips home as part of the expense of maintaining two households. This used to be limited to three consecutive years, but following recent court decisions, it can now be claimed indefinitely. Since you said you're single, however, this won't apply to you.

The tax year in Germany is the same as the calendar year. As an employee, you're expected to file your return for a given year by May of the following year. The tax return is fairly straightforward, assuming you don't have a lot of non-work income or income from abroad. As others have said, joining a Lohnsteuerverein is highly recommended, at least for your first couple of returns, until you get the hang of it.

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Posted

My Steuerberaterin manages to offset the cost of a flight home every two years since I still hold bank accounts in the UK, and my bank does not permit people living overseas to have access to their online banking....just saying, y'know?

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Posted

Any ideas where I can see a list of tax-deductables, or a list of tax credits?

Yes. With the overall income tax declaration form, there is an accompanying form that tells you these (Anleitung zur Einkommensteuererklärung). That's what I use. You can google it.

There's a whole raft of stuff on there than any employer has absolutely no interest in or does not engage with even if employment related: personal professional training, various household updatings, household services, donations, various healthcare-related stuff etc (that's a general list, the detail is more specific of course).

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Posted

Just briefly - is it possible for the working spouse to claim a tax offset on their German earnings for a non-working spouse residing with them in Germany and not caliming any form of unemployment benefit?

Thanks or for pointing me in the right direction

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Posted

You can calculate the income tax due if you're married by inputting your family income into this calculator courtesy of Mr. Parmentier, and choosing tax class/category III.

If you had been unmarried, you would have been in tax class/category I and would have paid more income tax.

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Posted

Excellent - thanks for the fast response and information - very helpful

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Posted

Hi,

I have a tax related question. I successfully made my tax return last year and had no problem. Now for this year, I have quit my job. I have 14 days vacation left. I have agreed with my employers that they will pay me for the vacation time.

I am wondering if this vacation money is taxable?

Also, you know the 8,000€ annual tax allowance. Do you have to claim this back at the end of the year or is it worked into your taxes monthly?

Thanks,

fadizhu

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Posted

I am wondering if this vacation money is taxable?

Of course it is.

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Posted

Hi all,

a quick question related to Doppelte Haushaltsführun.

I will relocate in Germany in February (my while will stay in Italy till August at least).

To claim flights cost back (in 2014) do I have to purchase tickets in 2013? or t's possible to buy them now (considering that tickets would be for February 2013).

thanks

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Posted

I assume you meant to say that your wife will remain in Italy for a while.

If you will only move in February 2013, wait until 1. January 2013 or after to buy the ticket for February 2013.

If you bought the ticket still in 2012, you could only claim for it in the 2012 tax return. This would mean that you would have to fill in all the 2012 tax return forms just for that ticket and that isn't worth the hassle.

So, just wait until 2013 to buy the ticket and then claim for it in your 2013 tax return.

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Posted

great,that's exactly what I meant :) Meanwhile, I hope that tickets price won't raise more than tax reduction :D

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Posted

If the choice is between getting a cheap flight for EUR 50-100 now and paying EUR 200-300 closer to the date, then you'll definitely be better off buying the flight now.

The dual-household deduction is simply that - a deduction, not a rebate or credit. You don't get the full price refunded on your taxes. This means even if you're in the top tax bracket, you'll get slightly less than half of the ticket price back in taxes - and that's at an annual joint income of EUR 500,000.

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Posted

If the choice is between getting a cheap flight for EUR 50-100 now and paying EUR 200-300 closer to the date, then you'll definitely be better off buying the flight now.

The dual-household deduction is simply that - a deduction, not a rebate or credit. You don't get the full price refunded on your taxes. This means even if you're in the top tax bracket, you'll get slightly less than half of the ticket price back in taxes - and that's at an annual joint income of EUR 500,000.

indeed I wouldn't expect to have whole ticket price back, So I will regularly monitor prices during these weeks

Can you please explain better the bold part?

Is it possible to claim back the room rent cost in a shared apartment?

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