Taxes in Germany
Germany has one of the highest tax rates in the world. Good for you, that Germany also offers a lot of tricks to lower your bills for taxes in Germany. You can save thousands of Euros every year!
Taxes in Germany - Get some back
Taxes are very common in Europe, especially in Germany. As PerFinEx we want you to be an expert when it comes to taxes in Germany, so that you know the German tax system even better than German natives. In the following, you will learn how to actually file your tax declaration, how you can get some more money back from your gross salary and also a lot of other important stuff to know about taxes in Germany.
legal tax tricks
- By filing your taxes you will get 1.051€ on average back
- You can get a lot of money back by investing in pensions
- Learn a lot more tax tricks in the following
More net income
- Learn five different tips to get more net income in Germany
- Get more by asking your employer some exact questions
- Health insurance is also a great way to get more net income
taxes in Germany - Your Personal Situation
Every employee has his/her own individual tax rate. But do you actually know what your personal tax rate is, or do you know how much taxes in Germany you have to pay as a self-employed person? In the following articles, you will find everything about your personal tax situation in Germany.
Our "Taxes In Germany" YouTube Playlist
Every week we publish at least 1 video on our PerFinEx YouTube channel on all things personal finance in Germany. Below you can find our playlist that contains all videos related to German taxes in Germany. That is all you need to bring your personal tax game to the next level.
Are you looking for calculators to get some taxes in Germany back? Our tax calculators will help you in some common tax questions.
In Germany, you have to pay a progressive tax rate. This means that your personal tax rate increases as your income rises. The beginning of the income tax rate is in the zero zone, the basic tax-free amount (10.347€ in 2022). No income tax is due here. After that, the income tax rate starts at 14% and goes up to 42%, which starts at an income of 58,827€. This 42% applies up to an amount of 277,826€. From here the top tax rate of 45% on your income starts.
The tax system in Germany works similarly to how it does in other, westernized countries. You are required to pay income taxes. This is automatically deducted from your payslip by your employer on a monthly basis throughout the year. Afterwards, a tax declaration is typically filed, or adjustments are made to reconcile any discrepancies.
- Single, separated/divorced, widowed
- Single parent, living separately
- A married person with high income (spouse has to be 5)
- A married couple with equal/similar income
- A married person with no or low income (spouse has to be 3)
- 2nd job or part-time
For some groups in Germany, filing a tax return is mandatory. These are self-employed and freelancers. It is also mandatory for you, if you are an employee and are in tax class 3, 4, or 5, you have divorced and remarried in the same year, additional income or salary replacement income over 450€, more than one employer in the same year, or with more than two salaries. For the other areas it is not obligatory, but can be useful, since 9 out of 10 people get on average 1.051€ back in taxes.
In Germany, no tax burden applies up to an annual income of €10.347 (in 2022). This is called the zero zone. After that, the lower progression zone begins, starting at 10.348€ and ending at 14.926€. The tax burden is 14% - 24%. The middle progression zone runs from 14.927€ to 58.827€ with a tax burden of 24% to 42%. The upper progression zone, with a tax burden of 42%, runs from 58.828€ to 277.826€. Then the proportional zone starts from 277.827€ with an annual tax burden of 45%.
Our service and contact
Personal finance in Germany can be difficult – especially as an expat with limited German language skills. We make your financial planning as easy as possible. All you need is a device that is connected to the internet to secure a free online meeting with us.