Pros and cons of German citizenship

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Hello TT readers,

 

I am a EU national pondering whether or not to apply for German citizenship (naturalization).  I fulfill all the requirements but don’t really feel much will change for me in my everyday life in here whether I am a German national or a EU national.  However, the example of Brexit have made me think if I should use the opportunity that I fulfill all the requirements and apply for citizenship.

 

Should something crazy like the disolution of the EU or another “Brexit type” situation involving my home country ever happen, it would be nice to have the same rights as German citizens, but it also poses the question if there are any (seldom talked about) obligations that could eventually be seen as a drawback after becoming a German citizen.  
 

Particularly, I am interested to know if there are any tax or financial implications (besides the application fees).  For instance, I think it is likely that at some point in the future I would like to live and work in another country before retirement, and also, most likely once retired, I would like to live in another EU country (other than Germany).  These potential future plans make me wonder if naturalization is the right thing for me...
 

1a) Do German citizens residing abroad need to fill out a tax declaration in Germany every year even if they don’t have any income, capital gains or property in Germany?

 

1b) Linked to 1a above, I will definitely have a pension associated to my years of contribution to the German social security system.  If I reside abroad after retirement, will that pension have a different tax treatment (in Germany) if I am a German citizen as opposed to a EU national?

 

2) Is there a difference in tax treatment for inheritance purposes between German citizens and EU nationals while residing in Germany?

 

3) Are German citizens required to pay any special taxes or contributions to the German system while residing abroad?

 

I appreciate your thoughts / advice with regards to these questions.  Much appreciated!

 

 

 

 

 

 

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I think it is good idea to have both citizenship, in case of EU country Germany allows to have double citizenship and if your country of origin also allows that all is fine.

if you do not live in Germany and are deregistered , you don't have to pay taxes in Germany or make any declarations.

Pension is calculated according years of contribution and amount , so in this case citizenship does not matter.

 

p.s about inheritance rules I can not say anything.

 

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Don't forget that by becoming German, you become one of the "baddies".

It's not a simple joke. If you have kids, they will learn in school "their" grandparents were "baddies".

On a personal level, I have no interest in becoming German, even if I can retain my Portuguese nationality.

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7 hours ago, alien7 said:

f you do not live in Germany and are deregistered , you don't have to pay taxes in Germany or make any declarations.

That´s only true in case you have no income from German sources. If you have, you´ll have to file as "beschränkt steuerpflichtig". This doesn´t have to do anything with citizenship though.

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They come after you for your parents' upkeep when the parents' money runs out and they are still in that Pflegeheim at 106 years of age. The kids are ultimately held financially responsible. Vaterstaat has its limits.

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7 hours ago, MikeMelga said:

Don't forget that by becoming German, you become one of the baddies.

 

On a personal level, I have no interest in becoming German, even if I can retain my Portuguese nationality.


I hope my children are intelligent enough to realize that none of their grandparents were eitheir German or even lived in Germany (ok, my wife’s parents came to Germany in the seventies) and be intellectually less bothered by it. 

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25 minutes ago, optimista said:

They come after you for your parents' upkeep when the parents' money runs out and they are still in that Pflegeheim at 106 years of age. The kids are ultimately held financially responsible. Vaterstaat has its limits.

 

It's good to know that there have been recent changes to that obligation: https://www.verbraucherzentrale.de/wissen/gesundheit-pflege/pflegeantrag-und-leistungen/elternunterhalt-kinder-zahlen-erst-ab-100000-euro-jahreseinkommen-28892#:~:text=Seit%20Anfang%202020%20m%C3%BCssen%20Kinder,Jahres%20in%20Kraft%20getreten%20ist.

 

Quote

Since the beginning of 2020, children only have to pay maintenance for their parents in need of care if they have a gross annual income of more than 100,000 euros. This limit was brought about by the Relatives Relief Act, which came into force on 1 January this year.

 

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I am quite sure none of the OP's points are anything to be concerned about. I have been through the process recently and initiated it after the Brexit vote for the very same reason (I'm Irish so brexit had a more direct potential to somehow take Ireland out of the EU, though this immediate danger has certainly passed now). I considered all the potential downsides carefully.

 

The only obligation I could think about which could be considered a negative would be the extreme case of conscription during war but that's a doomsday scenario and if it comes to that we're all probably fucked anyway.

 

Personally I would highly recommend naturalisation for any citizens that can keep their other citizenships, EU or not. If you can accept that it may take 2+ years to be processed and just forget about it and you won't miss the fees then go for it. It cost me a little more than 255 because I had to pay for a German test and the test on German customs or whatever it's called at the VHS and also had to pay for a certified translation of my birth certificate, probably 400 altogether.

 

It's great peace of mind to have German citizenship. Nobody can ever remove you from the country, which is still one of the world's most stable democracies. If Germany ever leaves the EU then the EU is over. I'm very much looking forward to being able to vote again in a national election for the first time in about 15 years as Ireland doesn't allow voting from abroad for regular citizens.

 

Also as an EU citizen you have no entitlement to any form of official German picture ID. You only have your awkward national ID/passport +Meldebescheinigung combination whereas non-EU get a useful picture ID similar in role to the German Personalausweis. I was caught out twice in my time in Germany with the "sorry your Meldebescheinigung needs to be less than 3 months old for this" and that can't happen anymore.

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15 hours ago, Strakurinn said:

1b) Linked to 1a above, I will definitely have a pension associated to my years of contribution to the German social security system.  If I reside abroad after retirement, will that pension have a different tax treatment (in Germany) if I am a German citizen as opposed to a EU national?

 

The answer is "no". There is only one country in the world with citizenship-based taxation, that is the USA. Regarding taxes on pension that will be your country of residence who will do it. 

 

There is currently only one downside of becoming a German citizen, that is the dual citizenship ban. However, as a EU national you can keep your EU passport. If your country leaves the EU you will have to revoke your first citizenship to become a German. So, you are right in thinking about applying now. 

 

 

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24 minutes ago, yourkeau said:

There is only one country in the world with citizenship-based taxation, that is the USA

Wrong! How can you ignore the other "taxation superpower" of Eritrea?

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1 hour ago, jeba said:

Wrong! How can you ignore the other "taxation superpower" of Eritrea?

Wow, you are correct:

Quote

It has been reported that Eritrea enforces this tax on its citizens abroad through denial of passports, denial of entry or exit from the country, confiscation of assets in Eritrea, and even harassment of relatives living in Eritrea, until the tax is paid

 

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2 hours ago, murphaph said:

It's great peace of mind to have German citizenship. Nobody can ever remove you from the country...

 

I agree with your post and greened you. It's why I went to what turned out to be the huge trouble of acquiring French nationality. I estimate it cost about 700 Euros and much faffing about and jumping through hoops over 3 years. However, I really think that the Brexit experience should have taught us that nothing is written in stone. You're good until they move the goal posts or retract your nationality. A long shot, hopefully, although mine was delivered solely on the basis of being married to a French national. And I have to stay that way for a minimum period - or indeed they can retract it again. So forgive me for thinking your second sentence is a little naive. I remember expecting to  have a European passport a couple of decades ago and that national passports would go out with the ark. How wrong I was.

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OK, even at 400 or 700 euro, its still many times cheaper than trying to British citizenship, and the German passport is one of the best passports to have, it allow almost the most countries to be visited without a visa.

 

You have to ask yourself what is the chance of my current passport, leaving the EU, to make that decision, but only you can take that risk and potential benefit.

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Yes indeed.

 

I am not planning on renewing my expensive British passport when it expires.

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9 hours ago, jeba said:

That´s only true in case you have no income from German sources. If you have, you´ll have to file as "beschränkt steuerpflichtig". This doesn´t have to do anything with citizenship though.

That is correct point, but to go in more details I think (correct me if I  am wrong) this is in case the person is regular employee of German company, if the deregistered person is freelance or independent contractor he is not obligated to pay taxes in Germany even if the source of income is German

 

 

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6 minutes ago, alien7 said:

That is correct point, but to go in more details I think (correct me if I  am wrong) this is in case the person is regular employee of German company, if the deregistered person is freelance or independent contractor he is not obligated to pay taxes in Germany even if the source of income is German

I´m no accountant but I´m pretty sure that - unless there is an agreement for the avoidance of double taxation with your country of residence in place which says otherwise - your income from German sources will be taxable in Germany (think e.g.  pension, rental income).

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16 hours ago, MikeMelga said:

Don't forget that by becoming German, you become one of the "baddies".

It's not a simple joke. If you have kids, they will learn in school "their" grandparents were "baddies".

On a personal level, I have no interest in becoming German, even if I can retain my Portuguese nationality.

 

Good Point.

I am Italian, so anyway at that time we were the "baddies" as well, friends of the baddies. Actually the only act of war my granpa did (he was freshly enlisted) was ambushing with his unit a Nazi column, after the armistice, being sure to kill every one in order to avoid any survivor reporting the position of his unit. So he was even a bloodthirsty backstabber, even more "baddy" :D

 

I guess the children will not get confused, in my case. Let's go for the double citizenship.

 

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1 hour ago, jeba said:

I´m no accountant but I´m pretty sure that - unless there is an agreement for the avoidance of double taxation with your country of residence in place which says otherwise - your income from German sources will be taxable in Germany (think e.g.  pension, rental income).


Yes, that's right.

 

For me, my Australian service pension is only taxable in Australia, but only because it's a pension for government service there - that's a normal feature of double taxation agreements. When I get an additional small Australian Age Pension in a few years, that Age Pension will be taxable in Germany (assuming we live there by then, the plan is to move to Germany from Austria in about 6 months time.)

 

But, in terms of ordinary pension income (if that pension is from working in Germany), afaik it will be taxable in Germany no matter where you live.

 

My wife (a German) gets a small German pension from a few years of working in Germany, and some Australian Age Pension. Both are taxable in Germany if her income is high enough (and if we were living there, which we are not yet), but apparently they changed the rules about 3 years ago, and her German Pension is taxed nowadays no matter what. Even though we're living in Austria, she got three separate tax letters with slightly different amounts payable each year for the last 3 years from the German pensions/tax people several months ago - only a few hundred was payable, but her German pension is very small, about 2500€ a year. 

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Just for completeness, I might add that although my Australian Government service pension is not taxable in Germany, if I became a German resident AND a German national, my service pension (as well as any Australian Age Pension) would then be taxable in Germany.

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19 hours ago, MikeMelga said:

It's not a simple joke. If you have kids, they will learn in school "their" grandparents were "baddies".

But you know that there are Jews living in Germany, most of them are immigrants from the former USSR?

 

Basically, I could get a citizenship under "Jewish immigration" program, but one needs to go to the synagogue because the purpose of this program is to show the world that Jews are now safe in Germany. I know people who immigrate, go to the synagogue, get the passport and then leave the religion.

 

I do not judge them because it is a fair deal for both sides: Germany pretends to be safe for Jews, the Jews pretend they observe their religion. Those Jews who really believe in all this, do not stay in Germany, they go to the Holy Land. 

 

I fully support the German education on their past except the "collaborators" part of the story: this is whitewashing and trying to pretend that Holocaust was done by Ukrainians, Lithuanians, Poles etc who collaborated with the Nazis. Nope. No. No way. Germany is still responsible, solely.

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