How to file your tax return in Germany (Checklist)

Marle

Updated on Nov 01 • 7 minute read

Did you know that a tax return in Germany has given back an average of 800€ to 1000€ to a German taxpayer over the last years? As you can see, anyone who doesn't go through a tax return in Germany is truly giving away real cash!

But being an international in Germany, your tax return proves to be a hurdle: on the one hand, there's the language as a barrier; on the other hand, the German tax system differs from the one you're familiar with. But don't fret, once you've mastered your tax return in Germany, the money bliss quickly fades away the stress.

Let's go step by step through the tax return in Germany. With our checklist, you won't miss a detail, promise!

Why should you file a tax return in Germany?

It’s as simple as that: there's money waiting to be picked up from you!

Disappointment strikes many internationals when they hold their net salary in their hands for the first time at the end of the month. After all, your employer automatically deducts income tax from your gross salary and transfers your social security contributions directly to the insurance company. So once all payments have been received by the tax office, a relatively slim net salary will land in your bank account.

In fact, did you know that Germany is the second most heavily taxed country in the world right after Belgium? By the time your first net salary arrives, you'll clearly feel that your net salary becomes a lightweight version of your gross salary.

Here's the good news! You can file your tax return at the end of the year and with a little luck, you'll get money back for taxes you paid too much!

As a matter of fact: to be precise: In 9 out of 10 cases the taxpayer gets money back after filing the tax return!

So, what are you waiting for?

Am I required to file a tax return in Germany?

First things first: At which point do I have to file a tax return and when is it voluntary in Germany?

Short and sweet, you cannot avoid filing a tax return in Germany if you:

  • had several employers at the same time in the year.
  • you have received untaxed income exceeding 410 EUR (pension, fees, rental income).
  • you have received wage replacement benefits (parental allowance, short-time work allowance, unemployment benefit).
  • you are married and both partners are registered in tax bracket IV or one spouse is registered in tax bracket V.
  • Divorced and married in the same year

Topping up your pocket money as a student by filing a tax return in Germany

It's often a bit fuzzy for students whether or not you should file a tax refund in Germany. If any of the following points apply to you, you must also file a tax return as a student:

  • you receive income from self-employment that exceeds the student tax allowance of €9,408 per year
  • have rental income or capital income of more than 9,408 € per year
  • Employed by more than one employer, i.e. you are assessed in tax class VI
  • you have entered tax allowances in your income tax card

So whether or not you should file a tax return as a student in Germany depends on your income situation. Without additional income, you won't have to pay taxes; however, as soon as you earn money above the tax-free allowance while studying, for example as a student assistant, your employer will pay income tax for you. And you can get that back at the end of the year!

BUT: a tax return is always worth it!

During your studies, you can deduct your extraordinary expenses and work-related deductions expenses from your tax bill.

In other words: all expenses that are connected with your education. Have you bought a new laptop for your studies? Great, deduct it from your taxes! Even textbooks, copies and also " office furniture" is tax-deductible!

  • Extraordinary expenses_(Sonderausgaben): The special expenses regulation applies to students studying for their first time and allows you to deduct a maximum of 6,000 € per year in your tax return as a student. By the way, you always have to file a tax return in the same year!
  • Work related tax deductions (Werbungskosten): Students in dual studies, second degree programs or second vocational training can deduct their entire training costs from their taxes.

The checklist for your tax return

Preparation is key! So make sure to add the one or two things to your to-do list before you file your tax refund in Germany:

1. Your tax number (Steuernummer)

13 digits given to you as a taxpayer by the local tax office. Your tax number is based on your place of residence and will change as soon as you move and a new tax office is in charge of you. You can find your tax number in the top left-hand corner of every income tax assessment and on your income tax certificate issued by your employer. Watch out: your tax number (Steuernummer) is not the same as your tax identification number! Your Tax Identification Number (Steueridentifikationsnummer) is a permanent and nationally uniform identification number that you receive upon registration in Germany.

Are you a freelancer in Germany? Then you got your tax number at the tax office (Finanzamt) and put it on all your bills so that you can get paid.

2. Double taxation: true or no? All your income, no matter if it is domestic or foreign, has to be taxed. And vice versa, your home country may also require you to pay taxes. With many countries, Germany has tax treaties so that you don't have to pay double taxes on your income. Make sure that you don't have two tax offices chasing you!

3. Get all forms Each taxpayer has a different fiscal background and so there are forms for all of us. By the way, you can deduct many things from your taxes in Germany - whether church tax or your donations. Should you have distinct language barriers, it pays off to use a tax consultant, at least for the first time.

4. Register with ELSTER Fill out your tax refund in Germany digitally in no time with ELSTER!

5. Meet your deadlines Your tax refund deadlines depend on whether you have to file a voluntary or mandatory tax return.

Check? Check! Let's go through your tax return step by step.

Step 1: Fill out the relevant forms for your tax return in Germany

There's no doubt, preparation is a must: Before you rush to fill out your tax return in Germany, you need to gather all the relevant forms. A tax return in Germany is obviously an individual matter, everyone has a different fiscal background.

Your task now is to find the relevant forms that are essential for your individual tax return in Germany:

  • Cover sheet(Mantelbogen): This form is the basic tax form for your income tax return containing your personal details, tax number and bank account information.
  • Annex N: for employees, i.e. non-independent work (wages, income-related expenses, employee savings allowance, etc.)
  • Appendix N-Aus: for employees with foreign employment
  • Annex N-Gre: for employees from non-independent work for cross-border commuters Baden-Württemberg to Austria, Switzerland and France (foreign income)
  • Annex AUS: for all who receive foreign income and the crediting of foreign taxes
  • Annex S: Income from self-employment
  • Annex EÜR: For self-employed persons, freelancers and farmers and foresters in the case of a revenue-surplus calculation
  • Annex KAP: for all who save (capital assets)
  • Annex R: for pensioners (pension and recurrent benefits)
  • Annex AV: for pension provision (contributions to the pension scheme)
  • Annex V: for landlords (income from renting and leasing)
  • Annex Kind: for parents (information about the child/children)
  • Annex VL: for all who save (capital-forming benefits)
  • Annex Extraordinary editions: Consideration of church tax, donations and membership fees, vocational training costs (without insurance expenses and pension contributions).
  • Annex Pension Expenses: The "Annex Pension Expenses" to the income tax return concerns the deduction of contributions to pension schemes, health and nursing care insurance and other insurance policies.
  • Annex Exceptional charges: Consideration of extraordinary burdens, e.g. medical expenses, lump sums.
  • Annex Household related expenses: Household-related employment relationships, services and craftsmen's services.
  • Annex Other: e.g. application for splitting the deductions in the case of individual investments of spouses/partners, loss deductions, donations carried forward, remaining tax-free amounts for protected old shares in investment funds.

Don’t forget, after all you can deduct many professional expenses from your tax declaration in Germany, as well as church tax or other expenses.

You can even offset labour costs around your house (even as a tenant!) against tax. So if you have a cleaner, gardener or craftsman, you can deduct these from your tax bill. Make sure you keep all receipts, as the tax office may want to have your expenses documented.

Step 2: File your tax return using ELSTER

Did you find out which forms you need for your tax declaration in Germany? Then get your relevant forms either at your local tax office or at the citizens' office. Simply visit the homepage of the tax office in your city.

It's much easier - and truth to be told, more “2020ish” - with the electronic tax return. The top choice is the free tax return program ELSTER, a software that simplifies your tax return and gives you tips on filling it out. On ELSTER you can download the necessary forms or fill them out digitally, print them out and send them to the responsible tax office.

By the way: In Germany, taxes and tax declarations are handled by the individual federal states. This means that your local tax office is responsible for your tax return. At the Federal Central Tax Office (Bundeszentralamt für Steuern) you can find your local tax office.

What's the deadline for the tax return in Germany?

When it comes to the deadline for your tax return, it makes a big difference whether you submit it voluntarily or are obliged to do so.

Anyone who files a tax return voluntarily can wait 4 years to complete it and submit it to your local tax office. This means for you: you have to submit your tax return from 2016 by 31.12.2020. A real bliss for procrastinators!

It’s different if you don't have a choice but to file a tax return.

With a mandatory tax return you have until 31 May each year to submit your tax return for the previous year.

In fact, you even have until 31 December of each year to file your tax return for the previous year when a tax consultant takes over for you!

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