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  1. Marriage and taxes

    The German tax system makes no sense to me...   here is my situation, can someone please enlighten me.   Say I earn 35000euro a year, my partner only 8000euro per year. We are both currently tax bracket 1. After marriage I would be tax bracket 3, my partner tax bracket 5.   here’s where I’m confused. theres currently a tax free threshold of ~ 9400 euro. While single, my partner pays no tax. After marriage will: (a) I pay less, and my partner now pays tax? Or will: (b) I pay slightly less, and my partner still pays no tax?   *we currently have separate finances, and live in different cities. And it will stay this way at least for the immediate future.  
  2. Tax returns filing (joint)

    Hi, I got married last year and therefore I filed a joint tax returns this year. My wife joined me here in December so she did not earn any thing last year in Germany.     She was working last year in Russia, and her taxable income was for like 10 months for which she paid taxes in Russia. Total earnings are around 2000 euro for 10 months.    Now when I filed tax returns I clearly put her earnings as 0 euro because I was under impression that she did not earn/work her ein germany. I got a letter from tax office now asking for a  confirmation of tax copy from russian authorities mentioning 0 euro .  I am confused (concerned). my main concern is how it will affect my calculations of what I will get back in form of tax returns for last year (earlier calculations showed somewhere around 6500 euro for last year) Second question I have is : Is it okay if the document I attach now will mention russian currency earned and tax paid in russia for that much time, is it acceptable ? given the fact that i put 0 euro earlier for her earned money ? (Since it was my first joint declaration i assumed it means only her earnings in germany)   Thanks KD
  3. Tax on money transfer from UK

    I need to transfer some money from the UK to Germany in the very near future to pay off a loan. I have no idea if this will be taxable in Germany or the UK or if there is a limit to how much you can transfer.   Additionally what is the best method to transfer money between the two countries ? Is it as simple as UK bank to DE bank ?
  4. Dear all,   I would like to ask for some help - in last February we moved to Germany with my wife, and as such we just submitted our first tax documents earlier this year. Yesterday I've got a mail from the tax office, as they would like us to file a WA-Est as well, however I have some difficulties understanding what goes where on the form exactly, and even google translate did not help too much.   I hope someone in this community already went through it, so maybe you could help us out in this one.   So, last year both my wife and me worked 1 month (me 11 days, she for the whole January) before moving to Germany.    Question 1: We already paid the taxes in our home country (Hungary in this case), but I guess this is what I should put to either line 6, 7 or 11-12 or 16-17?   On top of that I had stocks in the USA from a previous company, after which I paid the tax when I got them from the company(4, 3 and 2 years ago). These stocks I sold last year - unfortunately at a waaay lower price than what they worth when I got them, so basically got no profit from those. Now if I were in Hungary still, I could apply for a tax return / reduction due to the losses, but I have the feeling in this situation that is lost, as I would be surprised if Germany would pay me money back that I payed to Hungary in the first place.   Question 2 : I have this money sent back to my home country (Hungary). It contains no income, only negative losses. Do I have to put it anywhere in the tax documents?   Thank you very much for your help!  
  5. Tax return from Abwicklungsvertrag

    I have worked for one company in Munich until 31.05.2020. I was fired with Abwicklungsvertrag and I got Severance package (Abfindung), I paid around 50% tax on that Severance package (Abfindung). Since 01.06.2020 I am unemployed and I am getting Arbeitslosengeld. I don't have any extra income except the salary until 31.05.2020   My question is can I get money back from that 50% tax for the Severance package, when I do my 2020 Einkommensteuererklärung in the beginning of 2021, if I remain unemployed until end of 2020?   I asked some tax advisors, but they say that I have to pay and become member before they answer this question and I don't want to became member if there is no tax return.
  6. Trying to fill the annual 2019 Umsatzsteurerklaerung using Elster and PMs post, since I didn't have to pay any thing for 2018, (due to all UK clients), I was requested no to do the monthly filing for 2019 (monthly Umsatzsteurvoranmeldung). Now I have filled up the form with all my incoming and outgoings and have to pay around 10 EUR to FA.   Moving onto my question, given the above details, what should be my input for Besteuerung der Entgelte, line num 22, page 1 in Hauptvordruck (screenshot attached).   Moreover do I have to submit my bills (both incoming and outgoing) with the FA whiling filing the annual Umsatzsteuererklaerung please?   BTW, what the last day to fill the Umsatzsteurerklaerung for 2019 please?
  7. Double Taxation Agreement conundrum

    Hi,   I would really appreciate help with this.   I am a non-EU citizen with residence in Germany for 3 years already. I work at a research institution which sent me for a bit less than a year to China for work purposes (18.09.2018 to 01.08.2019). During that time, my German employer kept paying my wages, but following the rules established in the Double Taxation Agreement, the Chinese side was entitled to taxation. My employer provided me with a document entitled "Bescheinigung Gemäss Deutsch-Chinesischem abkommen über Sozialversicherung'. Now, in my Lohnsteuerbescheinigung for 2019, I have a sum in number 16a (Steuerfreier Arbeitslohn nach/ Doppelsteuerungsabkommen (DBA)), and I am having trouble about where to declare it.   I faced a similar situation last year, which got fixed after submitting an appeal and large amounts of evidence to the Finanzamt. But I would like to do it properly this year, I have sought advice with experts, but I keep getting conflicting information (whether I need Anlage AUS or N-AUS).   Can anyone provide a clearer take on this? I would greatly appreciate it!   All the best!
  8. Hi, I am aware that there is a capital gain tax on financial instruments, but not sure if it depends as well from the instrument traded itself? If the instrument has a high risk of capital loss, does it have less or no capital gain tax to be paid? An example: I bought an option on an index and sold it later with a higher price on the market. Do I need to pay taxes on this capital gain? My broker is DeGiro. Thanks in advance! Gledis 
  9. Hello, I’ve got some questions below, and any help is very much appreciated. First a bit of context: I’m 53, moved to Germany last year with my German wife, and we’re considering retiring here. Given our savings situation it appears I’ll need to work for the next 15 years at least. Currently I have German state healthcare through my wife (nurse), and we want to hold on to that if we stay, obviously.  Not sure yet how I’ll be employed here; I’m still learning the language (close to B2, I suspect, goal of C2). In the US I’m a mental health counselor, though I don’t have the requirements for that work here. I could do online coaching/counseling with clients in the US, but I fear entering the self-employment market without being clear about the risks and benefits. Also considering other online work, making money from writing/teaching. I will need my US SS benefits and will want to increase them, if possible … which is one of my questions. Regarding taxes, I get that I’ll need to file in both countries. When I find employment here, taxes will be deducted. I will report that income to the US, but use the foreign earned income exclusion (same as “Foreign Tax Credit”?) to prevent being double-taxed, yes? This is a simpleton question, but it’s where I’m at 😊 I read that a 2018 legal change for self-employed persons means that I would need to pay less into the health insurance, so that now it’s only ~190 euro per month. But as I currently understand it, if I do teaching/counseling/writing/editing work, then I *WILL* have to pay into the state pension? And therefore, simply picking up a few clients won’t work, one would have to pick up at least enough at the outset to offset the (~500?) monthly euros that would have to be paid for health insurance + pension. ?? It appears that IF I am employed for less than 5 years in Germany, then I can get the pension contribution refunded, eventually. ? The corollary is that, if I am employed longer than that, then I cannot get it refunded – instead I get a pension. But do I receive that regardless of whether I live in the US or in Germany? Given that I don’t have much time to build up a pension here, it seems that, even if I pay into it for 15 years, the amount of pension will be quite small, and less than if I were to have paid into the US SS for those years. Is this true? Is there a way to pay into the US SS system and just avoid the German pension system altogether? Thank you very much for your help!
  10. Hello Toytown,    I used to be a member way back when in 2010 when I moved to Germany and I’m happy to say I am back, albeit with a new account.    I have a question regarding “Spekulationssteuer” and “Verschenkung” related to property and would really appreciate your help and advice.    In 2016 my wife’s parents purchased a house which my wife and I live in and have done so uninterrupted since 2016. My wife’s parents are planning to gift the house to us “Verschenkung” and we are planning to sell the house due to relocation back to UK.    Now to the point, my wife’s parents haven’t owned the house for 10 years, and when we take it over it will have been in our ownership and previously her parents’ ownership for a total of 4 years. However, as previously said my wife and I have lived her as our main residence since purchasing the house.    Can we therefore avoid paying Spekulationssteuer / capital gains tax?  If we can’t, could we move to UK first and complete the sale as UK tax residents and avoid the tax that way?    Thank you so much in advance, happy to be back!    All the best,  David 
  11. Is language course deductible?

    Hello everyone!   I am a freelancer. When I first got here, my German was ok but unfortunatelly not anymore. I always had English speaking clients and friends. (ashamed)   Recently I moved to another city and to be able to find and convince new clients, I need to have a better German. I decided to take same German classes just to find work again. I plan to go up to C1 level.   My first question is: If I go to a language school to take German classes just because for my work, is it tax deductible?   My second question is: I found this web page "italki", there are german classes there as well. One of them was even named "Business German and Job Application Training". Would it be tax deductible if I take classes online?   I plan to spend around 1.000 Euros for the classes. Is there a limit for such thing?   I went through the forum and found many contradicting answers about the topic. Some said yes, some said no, some said it changed in years. I am hoping to find someone that knows the situation, not guessing about it.   The language is really bloking my works way and I really need to sort it out quick =) .   Thank you very very very much!
  12. If I am a ‘live in landlord’ what bills am I entitled to claim back on my tax return when declaring my rental income?  i live in my flat and this year took in two housemates who pay rent. I pay all bills directly in the Flat: Internet, Gasag, Vattenfall; Hausverwaltung. In 2019 there were some months with only two of us, some months with 3 of us. Should I claim only for the share that the other one or two housemates use and that I pay on their behalf? Or can I include the whole bill even though I benefit from it because I live there too?  The same question applies to the Hauswerwaltung. My housemates (tenants) are my friends and just pay a lump sum that is almost a made up number, a flat fee for them. So there is not specific cold or warm rent breakdown.  Should I retrospectively create a more solid contract and ‘make up’ a cold rent price? The monthly Hasgeld costs are 239€ total. Can I submit 450€ per room as cold rent, and then just claim the entire €239 of the hausgeld?   
  13. Hello,   I know capital loss on individual stocks can only be used to offset capital gains from individual stocks . My question is, what if the capital loss is on a mini-future contract which is open ended (no expiry date), with a single stock as underlying.  Can you offset this loss against other capital gains, or again only against gains from individual stocks? The product has a stop loss point when it expires worthless, so I assume it doesn't hit this level, otherwise with the new law I refer below it will be not eligable for loss deduction more than 10,000 eur/year.   Here is an example of such a mini-future contract:   Also there is a new law passed in December 2019, setting a limit of 10,000 euros/year per loss ofset, from certain certificates and futures, but as I understand only if these have an specific expiry date, so that this new law would not be covering the mini-future described above, is that right?   Thank you!
  14. German annual tax with uk salary

    hello   I am living in Germany and receiving a salary from the uk to my uk bank account.   I am trying to fill out the form  "Anlage N- AUS" online with ELSTER, however I am not 100% sure, if I am doing it correctly.  Could someone walk me through Anlage N-AUS. I speak english and german. thanks      
  15. Tax swap (shift) in Germany

    Hello,   my question is simple. Is Tax swap (or Tax shift) possible in Germany?   DEFINITION of Tax Swap: Tax swap is a method of crystallizing capital losses by selling losing positions and buying companies within similar industries that have similar fundamentals.   Thanks and best regards, Jaime
  16. Hi!    I posted previously about wanting to move back to the UK despite the current crisis and have now been offered a job in the UK - starting July 1st. I'm very hopeful I can negotiate my notice period here in Germany down from 3 months, as I'm currently on 50% Kurzarbeit and there is not much for me to do at all.. So taking me back up to 100% for a month should be more than enough time to prep for my departure - I read that they I can't be on Kurzarbeit during my Kündigungsfrist, please correct me if this is wrong!   My question though is that if I accept a job in the UK, paying via PAYE into my UK bank account - do I need to physically leave Germany before the 1st July in order to be tax resident in the UK? Or is there an acceptable overlay where we can be wrapping things up here in Germany (I'm talking 2-3 weeks, not months) but I can already be working for my UK employer?   I've been living and working in Germany since Nov 2016.   Appreciate any advice, want to make sure we don't make any critical errors here!    Cheers,   Rebecca
  17. I am living in Germany and have a regular income from a company, and would like to do tax declaration for year 2018.   In 2018, I used a broker to trade stocks/shares. My broker is based in UK and Cyprus. I traded thousands of things (buy and sell positions in: Forex, stocks, commodities, futures). The dividend i earned were negligible, as i mostly traded intraday. In total i lost a few hundred Euros.    I've read here that i should enter these information in Anlage KAP. (1) What is the difference between line 4 and 5? which one i should choose?   Somehow it is impossible to separate all of the thousand trades and write them in the lines 7-11.  (2) Can i write only the lost amount in line 10 or 11? (3) Some of my trades were "buy positions" and some of them were "sell position". What is the difference between lines 10 and 11?   Thanks in advance. 
  18. I'm a US citizen, tax resident in Germany and looking to get a euro denominated mortgage to buy a primary residence, I do not want to use an LLC (QBI). In the eyes of the IRS I would be taking out a long term short position on the US Dollar, this is due to IRC legislation that prevents individuals from declaring a mortgage in a non-functional currency, this means my mortgage counts as a section 988 transaction and any unrealized gains due to currency fluctuations are taxed as ordinary income.   Almost all examples that I have come across deal with "interest only" mortgages where there are no capital repayments during the life of the mortgage, and only when the house is sold do the taxpayers find that they have to pay income tax on the phantom gain resulting from the change in the exchange rate between the USD and the currency the mortgage was taken out in; even if no actual gain was realised.   An example from this site: [3]     £ $ Approx. Mortgage Valued in £ 250,000   Exchange Rate at 16/12/2005 1.9267   Approx. Mortgage Value in $   481,675       Approx. Mortgage Value in £ 250,000   Exchange Rate at 07/07/2013 1.4877   Approx. Mortgage Value in $   371,925       Foreign Exchange Rate Gain    109,750       Tax Charge at Marginal Rate of 28%   30,730   My issue with publicly available resources on section 988 is that it is geared towards forex traders, where the transaction is disposed in its entirety at the end and not repaid in partial amounts, this confusion is present in most sources (i.e. does repayment mean in full? or partial?). What I'm afraid of is getting a mortgage and repaying it gradually, then having to wait until the exchange rate is close to what was when I took out the mortgage to then pay the final instalment or face a massive tax bill on a phantom gain. My theory is that i can take out a euro denominated mortgage, make repayments on a monthly basis and then only if my phantom gains from the exchange rate exceed the standard deduction for that tax year would I have to pay any tax. This means that over the years if the dollar appreciates I could adjust my payments accordingly.   So...   Given an annuity mortgage in a non-functional currency:   1. Would monthly capital repayments during a tax year incur income tax on a phantom gain? 2. Can a phantom gain be reduced with the standard deduction? 3. Would i report the net gains and losses from multiple capital repayments in a year or are all losses ignored? 4. Would this be reported on IRS form 8949?   (i have emailed a couple of tax advisors but not heard anything back yet) sources: [1]  (the only link where multiple repayments were talked about) [2] [3] [4] [5]  
  19. US expat tax filing and German pension funds

    Hi, I am a US american/german dual citizen that has been living in germany for 20 years. recently I found out about my tax filing obligations in the US and am planning on applying for the streamlined offshore procedure soon and have a few questions related to that. I know that many questions on tax returns for US americans abroad have already been asked and solved in these forums so I hope I haven't missed the answers! The main problem is that I am VERY confused about my pension plan and how to report it. I have a "fondsgebundene Rente", which means that it is a private pension scheme (no employee contributions) whereby I make monthly payments to the company (Ergo versicherung) who invests the money in various stocks, bonds whatever (apparently a company secret). The idea is that hopefully the money will grow that way and I will get a larger pension than if I put it away in a savings account. I have the option of buying back the account prior to reaching pension age, but at a huge loss. Otherwise, there is no option for me to withdraw any partial amount of the savings before retirement. From my reading, I guess this would be some kind of an IRA, though I think a requirement for designating it as an IRA is that the managing company has to be in the US or part of an international company with a branch in the US? but not sure about that.Or is it a foreign trust? I am also muddled about whether I need to declare anything at all about this as I do not receive any payments from it but am only paying in at the moment. I understand that with an IRA, people would want to declare the payments as a deduction from income. because my income is so low, the foreign earned income exclusion gets rid of all my taxable income so I don't have any taxable income. So, I'm not interested in taking advantage of any further deductions at the moment. I just want to make sure that I'm declaring what I need to by law. if it is indeed a foreign trust, then there are apprently potentially serious consequences for not declaring it as such in the FBAR and for not filing the 3520 form on foreign trusts. Anybody have any ideas about this? I'd be extremely grateful for any help! or maybe someone has a reference for somebody with reasonable rates that could just advise me on this one issue? I'm trying to get most things done by myself to save money, but have not been able to figure this one out!
  20. Can anyone please recommend me an agency (online or whatever else) for filing my back taxes to the US with the fast track amnestry program? I've been paying in Europe for years now and was stupid...I didn't think I had to since I was under the double taxation limits.   I've been getting quotes but the amounts are all over the place, sometimes crazy high more than whatever penalties I could get. My situation tax wise is straight forward, I don't own any property or anything. I'm just looking to file the paperwork without breaking the bank to do it.   Any recommendations would be great well apperciated!
  21. tax question

    Last year i started a new job for 2200 gross that came to 1600 net. 2 months ago i received 200 eur more as a bonus on my gross pay coming to 2400 but that seemed to have incised my tax percentage since now i receive only 1647 eur net. is this supposed to hapen and i am supposed to be taxed at almost 42% of my paycheck for the money i make. i am tax class one
  22. Declare small income? (non-resident)

    Hi,   I'm a former resident of Germany and now on the other side of the planet and need some help from the collective knowledge of the trusty TT army.   I'd like to provide a foreign company (UK based) with a service and they can only pay in GBP, EUR or USD, bank account or Paypal. I still have my German bank account (with address with relatives) and think I prefer that option rather than lose money through the terrible Paypal conversion rates.   Question is then, for this small income of about 50 EUR a month, do I have an obligation to the Finanzamt? I properly deregistered when I left Germany.   Thanks for your input!