Taxes in Germany
Every company has to pay taxes, and the most important tax for businesses in Germany is income tax.
Tax system and rates
Germany’s fiscal administration is divided to federal tax and state tax authorities. The local tax offices apply to the latter. They administer the “shared taxes” for the Federation and the States and process all the tax returns.
The competent authority is the Federal Central Tax Office, which is also competent authority for various applications of tax refund from abroad. Since 2009, the BZSt gives an identification number for the tax to every taxable person.
Direct tax
Direct tax is one obligatory upon an individual person (juristic or natural) or property as distinct from a tax imposed upon a transaction.
Indirect tax
An indirect tax is a tax collected by an intermediary from the person who bears the ultimate economic burden of the tax. The intermediary later files a tax return and forwards the tax returns to government.
Net income
In any of the aforementioned groups, net income is calculated on all total earnings earned over the fiscal year and decreased by revenue-related expenditures for the same time. Losses from one of the seven types of basic income (except capital investment) should be entirely compensated against positive income from another category of income (exceptions which apply to other income').
Tax rates
The table below presents several of the most prevalent tax types along with their corresponding rates.
| Tax | Tax Rate |
|---|---|
| VAT | 19% |
| Corporate income tax | 15% |
| Personal income tax | 0% – 45% |
| Dividend tax | 25% + 5.5% solidarity surcharge |
| Capital Gains tax | 25% |
| Property tax | Varies by municipality |
| Inheritance tax | 7% – 50% |
| International tax | 0% – 45% (depending on income type and treaty agreements) |
| Cryptocurrency tax | 0% – 45% |
Business in Germany
Our company provides services for setting up a company in Germany. The specialists of our company have the necessary knowledge, experience, and qualifications. We can offer a consultation with taxes in Germany. In addition, we also provide business support, accounting, and other services necessary for your business. Our specialists have vast experience in this field of activity. We will be happy to help you successfully open a business in Germany.
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Disclaimer
Tax laws and regulations are continually evolving and can differ depending on personal situations. The information presented here serves as general guidance and might not represent the latest updates. It is strongly advised to seek the assistance of a qualified tax professional for tailored and current advice related to your specific circumstances.