Find a tax advisor in Germany
The German tax system is closer to that of most other western countries than you might think. Salary deductions, income taxes, and capital gains all form part of the infrastructure. Germany's income tax varies by income, rising incrementally with every increase in earnings. Unlike most western nations, however, that percentage begins at 1% and rises to 45%. Solidarity surcharges will probably be less familiar to you. They're an extra fee that all legal residents must pay over and above their taxes. Let's take a closer look at what you can expect to pay.
List of tax advisors and consultants
If you're hiring a tax advisor, Germany has a huge range of specialists. If you're new to German taxation policies or your finances are complicated, it makes sense to consult a professional. Bear in mind, though, that Steuerberater is a protected term that doesn't apply to bookkeepers. Only licensed tax advisors can submit your declarations on your behalf.
- SteuerGo: This online tool helps you to handle your online filing through an English portal. Visit steuergo.de/en to handle your annual tax return. The site can also be used for income tax, capital gains, or even childcare costs.
- Tax Services for Expats: This team is managed by a licensed tax specialist with 20 years of experience. The leading advisor specializes in income, wave, corporate income, and value added taxes. Get in touch by emailing email@example.com.
- Susanne Regenbogen is another professional with decades of experience serving business, expatriates, and private clients. Call her team if you need an English-speaking tax consultant on 06101 51234.
- If you prefer a strategic approach, Barnbrook GMBH will help you with your tax planning and implementation. Call +49 30 4849267.
- If you're looking for a local tax advisor Munich has an excellent expat expert called Thomas Zitzelsberger. Contact him on 089 921 313960 to find out his tax consultant cost policies.
- If you're looking for an international tax advisor Munich based Alexia Huber is ideal. Call him on 89 121 932 800.
How income tax is charged
Germany's taxable income is divided into eight sub-categories:
- Trade or business
- Agriculture and forestry
- Capital investment taxation
- Current income and compensation
- Alimony, annuities, and other forms of income
- Independent personal services.
The corporate tax rate is 15%, and your municipal trade tax will fall between 14 and 17%, so your total taxation will add up to 30% to 33%. There used to be solidarity surcharge, but that no longer applies.
What you can expect to pay
Your income tax will vary depending on the status of your residency. Residents must pay taxes on their global incomes, but non-residents only pay taxes on income earned on German soil. In the latter case, your global income will still play a role in assigning your tax rate. Stocks, interest, and dividends are taxed a little differently. They carry a flat tax rate of 25%. To answer the question of taxation more directly, a 42% tax rate covers incomes over €57, 000. Taxable income over 57,000 will be charged tax at a rate of 42%. You can reduce your capital tax amount through deductible expenses and tax refunds. The latter will be filed as a declaration that itemizes your expenses. Not all forms of income are taxed. Exemptions apply to maternity leave payments, unemployment benefits, and some foreign income during the first year of your expatriation.
Understanding tax classes
Germany takes privilege into account when calculating taxes, so if you're single, separated, or earning multiple incomes, you'll be taxed a little differently than your professional peers. There are six different classes covering individuals who have more than one employer or households with two income sources. You'll need to file a tax declaration every year on 31 May, including all your deductible costs. These include insurance, maintenance, and any expenses you rack up as a self-employed earner. If you're taxed at source, you needn't worry about this annual responsibility.
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