Declaring UK income on a German tax return

Can anybody give me some advice on the following situation?

I moved from UK to Germany in Oct 2007 and have been working in Germany since. I am trying to complete my German tax return for 2007 (using a software package) and would be grateful for some clarification on how to declare my UK income for last year.

1. Given that the UK and German tax years are different, should I declare the UK income earned from January to October as per the German tax year, or from April to October as per the UK tax year?
2. In addition, I rent out a flat in UK which currently runs at a loss (mortgage payments > rental income). Can I incorporate this loss into my overall UK income, or is this not permitted?

Many thanks in advance for any guidance.

you have to use January til December, they want copies of your pay advices not just a P60/45 plus preferably they want you to calculate the approx. amount into €uros. (sending the pay advices gets you out of sending them a proof that you have paid your tax in the UK between Jan and Dec 2007, and as this isnt the usual tax year in the UK, HM will charge you to issue you this special form!)

If you aint a BIG earner its hardly worth wasting all that time filling in all the papers making copies sending everything off to them etc! I had to give them LOADS (at least €1500) for tax last year and only worked here between mid Aug to Dec and they gave me whole €100 back... sorry in my opinion not worth the hassle... then if you even have a flat rented out in the UK ... you probably wont get a [s]penny [/s] cent from them anyway!

good luck if you wanna try it anyway!

you should seek out a decent Steuerberater. I had similar questions with regards uk earnings and it is not as simple as you would think.
Besides, May was the deadline for 2007 if you are doing it yourself. You can submit up till the end of December if you use a Steuerberater.

...the killer line! Ask a good tax question and get the "ask a good tax advisor" answer...there may be a "good tax advisor" on TT willing to divulge the answer...they are shy retiring types, just give them a chance!

rgs

Enda Storey: killer line---- maybe, but the best there is.

2/3 of the worldwide literature on taxation is written about the German tax system. My own tax advisor who is 60 years and is also a certified "Wirtschaftsprüfer" (which is like the creme de la creme of the German tax advisor guilde) says he can barely track all the new rules and regulations anymore and that he and his colleagues have to pay much higher premiums into their compulsory liability insurance every year because even tax advisor tend to make more mistakes in a chaotic tax environment...

based on this: would you really want to get some information here on Toytown for a complicated issue of double taxation by some TT-aka? There are some guys here who have a good basic knowledge of taxation (Freising, I think is among them, Jonny English too and others) and I myself hold even a degree in "International Taxation" from the Harvard Law School (class of 2000), but neither I nor I guess any of the above mentioned guys can give any other or better adivce for Twiga then to contact a tax advisor - and possibly one who is involved with Expat issues on a daily base and know his shit - a normal German tax advisor might not be to deep into double taxation issues and all...

This is why the line "ask a good tax adivsor" is mainly killing bad and potentially desastrous second hand advice. If people had a solution which worked for them 2 years ago, that does not mean that the same solution will still work today, seeing how creative our tax legislation has become...

Cheerio

1/ The Finanzamt will be interested in everything within the calendar year.

2/ You are supposed to declare all UK income so declare the rental income as a loss.

It's worth getting a good Steuerberater to enable you to claim the allowances you don't know exist and the Finanzamt are less likely to pick over your Steuereklarung looking for mistakes if it comes through a Steuerberater.

You work to the German tax year and have to declare your UK income.

If I could not match an actual, I just apportioned on a time basis. I have the relevant UK forms (P45, P60, bank interest certs etc) but did not submit them and I've never been asked for them.

I'm happy to do my return myself (accountant, lots of German family support) but otherwise I'd get advice.

Also, bear in mind that information flows between tax authorities. The authorities here routinely receive information from the UK HMRC on transactions with a tax impact that UK citizens residing in Germany do in the UK.

If you are going to pay tax on your UK income in the UK. I would only declare your non UK income in Germany. If you are not careful you will pay tax in both countries and it is very difficult if not impossible to to get it back if you have paid in both countries.Believe me I know to my cost.

The UK income should be declared in UK (even if it is a loss) as it is unearned income arising in UK. It should be declared here as income also declared in UK. This is why I suggest you see a Steuerberater to make sure the Finanzamt understand it is also being declared in UK. I have never had to pay tax twice on UK income.

It is also worth noting that while mortgage interest can be offset against rental income in UK it is not, as far as know, deductible here. Instead you can offset a percentage of the value of the property as depreciation and some of the other tax deductible expenses are treated differently. Again, a Steuerberater can help here.

Talk to the Inland Revenue about whether a loss on rental income in one UK tax year can be used to offset a profit in a future year.

I'm thinking of buying a house in the UK and renting it out. The mortgage would mean that it would run at a loss. I'm currently over in England and spoke to the tax people and they said the following:

I would have to fill out an NRL1 form. The letting agent would then pay me the gross amount of rent and not deduct UK tax.
At the end of the year I would have to fill out a UK Self Assessment form and if no profit was made I would not have to pay UK tax.

Still no idea what the Germans would do, although the government worship the God of Taxation I assume I'd be screwed by them, even if it ran at a loss. Can anyone clarify?

Just resurrecting this thread in case someone has some up to date information on this?

We are permanently resident here and pay German taxes on all income in Germany. But we have properties in the UK which we rent out - they are operating at a tiny profit. We have dutifully paid tax in the UK on these properties by submitting the required self-assessment forms.

We didn't declare the UK income on the German tax return last year - didn't think we had to as we were already paying tax (at a high rate I might add!) in the UK.

Now my husband has employed a Steuerberater, but we are unsure about whether or not we have to tell him about this? We want to be open and honest, but want to know beforehand if we are going to have to pay tax in Germany on the income from these properties as well, even though we are already paying in the UK? Surely that wouldn't be the case?

Ask your steuerberater...that's why you pay him the big bucks

Don't want to ask him yet, if he says that we have to pay tax twice we won't try to dodge it, would feel too guilty. But we would just like a heads up in advance so that we can prepare ourselves mentally!!

Thing is, if you have to pay, you have to pay, the sooner you know the better. Your steuerberater may be able to do some of his legal-loophole-ninja work to minimise the amount you need to pay...make him work for his money.

.... it stook some time to write this as the phone rang.....

If you are resident in germany you have to declare your world-wide income here......

Answer = YES

Declaring income does not automatically mean that you will have to pay tax here. I presume you can offer official evidence of what taxation you paind to the UK Inland Revenue. Basically what should happen is that the Finanzamt levies the taxation here and deducts what you have already paid elsewhere. Snags arise when views on taxation differ - for example is something (eg a savings plan) is considered "tax-free" in one country but the other country does not hold itself party to that agreement. So its not a certainty that the Finanzamt will recognise part or all of the tax you paid in the UK