If you’re living in Germany long-term, you will be subject to file a German tax return. Let us guide you through the maze of taxes in Germany.
If you’re employed, self-employed, run a business, or buy or inherit a property in Germany, you’ll most likely be liable to pay tax. Of course, there is also value added tax on certain items you buy. You might also be liable for tax in your home country too.
Income tax in Germany
Germany imposes income tax (applicable in every one of the 16 federal states of Germany) and a Solidarity Surcharge Law on individuals. Anyone carrying on a trade or business (including the self-employed) is also subject to business tax and municipal business tax – this is levied on all business enterprises in Germany, regardless of their legal form. Under the Church Tax Law, individual members of recognised churches are also subject to church tax.
Germany also levies value added tax, real estate transfer tax, an annual municipal tax on real property and a tax on insurance premiums.
For more information regarding taxes in Germany, read our articles on:
- Individual income tax for employees
- Corporate tax rates for entrepreneurs
- Corporate tax
- Inheritance tax
Filing US taxes from Germany
Despite the fact that every US citizen and green card holder is required to file a tax return with the IRS even when living abroad, many expatriates still fail to do so. Many are unaware of these obligations, thinking that as an expat they do not need to pay or file tax returns in the US. You do! For more information and help filing your US tax returns from Germany, contact Taxes for Expats and see our Guide to taxes for American expats.
Please note: The information contained within the following articles is for guidance only and you should always seek the help of an accountant or similar professional for specific tax advice pertinent to your own situation.
The Bundeszentralamt für Steuern (Federal Central Tax Office) has information in English on its website.