The taxation of individuals in Germany is different from similar systems in other European countries. Residents pay taxes from all sources of income that were received in the territory of residence. Basically, the issue of financial contributions to the treasury is dealt with by employers, who regularly withhold a certain percentage of wages. But, in addition to the payroll tax, there is also income tax, which is paid by individuals on their own. A tax return in Germany after a year is submitted by every resident of the country who receives income. With its help, you can return part of the money paid to the state.
Tax classes in Germany
For the calculation of taxes in Germany, tax classes are specially provided for by which payers are allocated. There are 6 classes in total, each of which can be assigned to an individual depending on his marital status. Belonging to one category or another, a person can count on certain financial benefits or pay the full amount.
Tax classes are distributed as follows:
I - Lonely, divorced, childless persons.
II - Single Parents. Such persons have the opportunity to receive a child benefit.
III, V - Married couples. With different incomes, and also if only one family member works, citizens can count on a double benefit (8 354 euros per person).
IV - Married couples with the same income.
VI - Persons employed in several jobs. In this case, one job will be taxed in classes I to V, and the second is taxed in class VI without benefits.
Taxation of individuals in Germany is not limited to just one salary collection. Residents of the country are required to pay government fees on any income received.
These include:
- income from any activity that generates profit;
- income received from renting real estate or land;
- income from secondary employment (auditors, translators, financial consultants);
- income from deposits and available capital.
Also in Germany, there are other taxes that are mandatory for individuals:
- for the purchase of land,
- land,
- for real estate,
- church,
- for inheritance,
- on the car.
For more information, see the article "Taxes in Germany".
Practical application of the tax return
Persons living in Germany for more than 6 months can submit an income tax return. Residents who belong to the 3rd, 4th, 5th and 6th classes of taxation must submit this document without fail. There are certain exceptions for grades 1 and 2.
In fact, almost all Germans fill out tax reports, because it is beneficial for them: unlike other countries, in Germany, using the declaration of income and expenses, you can return the lion's share of the tax paid for the year.
The basis for calculating the tax is the income of an individual received during the year. For its calculation, all cash receipts of the employee are taken both at the main place of employment and at the additional one, as well as unearned benefits.
Costs that are deductible in accordance with the law are deducted from the income part. The resulting amount of net income is taxed. It is by filling out the main financial document that you can designate all the costs that are compensated by the state.
Filling out the declaration: how you can get back part of the taxes
The tax return includes the main form (Mantelbogen) and supplements (Anlagen). Each supplement has a letter designation:
- the letter N is used for employee forms;
- information about children is entered in the form marked K;
- the KSO supplement is filled in by persons who own real estate, have money savings and other material benefits.
Each separate theme has its own addition.
The declaration contains personal data, address, bank account number, existing insurance policies, and also indicates all costs to reduce the tax burden.
The German tax system allows you to significantly reduce liabilities by deducting various kinds of expenses from them.
It is allowed to deduct the costs incurred in connection with such actions:
- purchase of benefits to study the correctness of filling out the declaration, as well as payment for the services of a tax consultant;
- training at your own expense in another profession (there are restrictions on the write-off of a certain amount per year); ...
- hotel accommodation for the period of study;
- purchase of educational material - books, manuals, computer programs;
- the acquisition of things necessary for professional activities (clothing, stationery, literature, arrangement of a home office);
- travel to the place of study or work;
- participation in charity events and clubs (it is important to attach a receipt for donations and contributions to the declaration);
- attracting third parties to help with household chores due to illness or old age (over 60 years);
- caring for elderly or sick relatives (a doctor's certificate is attached that a loved one really needs care).
Also, unforeseen expenses for a funeral, divorce, litigation, the acquisition of new property due to the loss of old property as a result of a fire or theft can also be written off from taxes. But at the same time, the tax office will first check the reimbursed amounts for insurance, take into account the presence of children and calculate the total income. Only after all calculations will the due amount be returned.
In order to return next year the amounts of taxes withheld in the current year, you need to collect all checks, certificates, payment receipts throughout the year and attach them to the declaration.
There are several ways to fill out the declaration:
- seek help from a tax consultant;
- independently on the Internet in a special program ELSTER or on helper sites like https://www.smartsteuer.de;
- in person at the office of the fiscal service on printed forms (the declaration forms can also be downloaded from the official website of the authority).
The completed document is signed and sent to the Finanzamt.
It usually takes no more than two to three weeks to process the materials received from the tax service, after which a confirmation of the acceptance of documents for work comes from it.
The result of checking the declaration will be a conclusion indicating the amount that you can get back or pay in addition.
Submission of the declaration on time
Anyone who must fill out the declaration must do so by May 31 of the year following the reporting year. For example, a document on income for 2021 must be submitted to the tax office no later than 31.05. 2021.
If the declarant seeks help from a tax advisor who takes care of everything, the deadline for submission is extended to December 31.
When a person is not obligated to fill out this financial document, but at the same time wants to return part of the taxes paid, he can submit a report for the next four years.
Penalties for failure to submit a declaration
The taxpayer is liable for delays in filing documents with the tax authority. In case of non-submission of the declaration or late completion of the report, a fine of up to 10% of the amount of taxes payable is provided, but not more than 25,000 euros.
Conclusion
Anyone who lives in the country for more than 6 months a year and receives any income is required to file a tax return in Germany. Payers are divided into classes. The declaration is filled out with the help of specialist consultants, helper websites or at the tax office.
Honest income declaration in Germany makes it possible to return part of the money spent. Knowing all the nuances of filling out a financial document, you can receive significant monetary reimbursements from the state for your purchases and personal expenses.
