Filing a tax return in Germany (Einkommensteuererklärung) is an essential financial step for many residents, whether they are employees, freelancers, or business owners. While not everyone is legally required to submit a tax return, doing so can often lead to a tax refund. On average, 9 out of 10 people who file a tax declaration receive a refund, making it a worthwhile process.
Who Needs to File a Tax Return in Germany?
While many employees in Germany have taxes automatically deducted from their salaries, certain individuals are required to file a tax return, including:
- Self-employed individuals and freelancers
- Those with multiple sources of income
- Anyone receiving income from abroad
- Married couples opting for tax class 3 or 5
- Recipients of welfare benefits exceeding €410 per year
- Those who have received severance payments or extraordinary income
- Individuals claiming tax deductions
- Those who receive a notice from the tax office requesting a tax return
Even if you are not required to file, submitting a tax return can be beneficial as it allows you to claim deductions and potentially receive a refund.
How to Complete a Tax Return in Germany
You can file your tax return in several ways:
- ELSTER (Elektronische Steuererklärung) – The official online tax system provided by the Federal Central Tax Office.
- Paper Forms – Traditional paper submission is still an option but is less common today.
- Tax Software – Using tax software can simplify the process, especially for those unfamiliar with the German tax system. One of the most efficient and user-friendly options is WISO Steuer, which guides users through the process and maximizes potential deductions.
- Tax Advisors (Steuerberater) – If your financial situation is complex, a professional tax advisor can provide personalized assistance.
Key Documents Required for Filing a Tax Return
Before submitting your tax return, ensure you have the following documents:
- Tax ID (Steueridentifikationsnummer) and tax number (Steuernummer)
- Employment tax statement (Lohnsteuerbescheinigung) from your employer
- Bank account details (IBAN) for tax refunds
- Receipts and invoices for tax-deductible expenses
- Details of any additional income (e.g., rental income, investments, foreign income)
Tax Deductions and Allowances in Germany
One of the main advantages of filing a tax return is the opportunity to claim deductions. Here are some common tax-deductible expenses:
Work-Related Expenses
- Commuting costs (€0.30 per km for the first 20 km, €0.38 per km thereafter)
- Job application costs
- Relocation expenses for work
- Training and educational expenses
- Home office expenses (up to €1,260 per year from 2023)
Insurance Contributions
- Health insurance (100% deductible)
- Long-term care insurance
- Unemployment insurance (up to €2,800 per year)
- Pension contributions (100% deductible from 2023)
Personal Deductions
- Alimony payments (up to €13,805 per year)
- Church tax payments
- Charitable donations (up to 20% of gross income)
Child-Related Deductions
- Education expenses (up to €5,000 per year per child)
- Childcare costs (up to €4,800 per year per child in 2025)
Tax Classes in Germany
Your tax class (Steuerklasse) determines how much tax is deducted from your salary. The tax classes are:
- Class 1 – Single, widowed, or divorced
- Class 2 – Single parents
- Class 3 – Married (higher-earning partner)
- Class 4 – Married (equal income partners)
- Class 5 – Married (lower-earning partner)
- Class 6 – Second job or incomplete employee information
If you are married, choosing tax classes 3 and 5 strategically can help optimize your household tax situation.
Tax Deadlines in Germany
The German tax year follows the calendar year (January 1 – December 31). The deadlines for submitting a tax return are:
- Mandatory tax return: Due by July 31 of the following year.
- With a tax advisor: Extended to April 30 of the second following year.
- Voluntary submissions: You can file up to four years retroactively.
Extended Deadlines for 2022-2024
Due to special circumstances, the deadlines for recent years were extended:
- 2022 tax return: Due by October 2, 2023
- 2023 tax return: Due by September 2, 2024
- 2024 tax return: Due by July 31, 2025
If you use a tax advisor, deadlines are further extended, giving you more time to file correctly.
Receiving Your Tax Assessment (Steuerbescheid)
After submitting your tax return, you will receive a Steuerbescheid (tax assessment) from the tax office within two to six months. This document confirms whether you will receive a refund or need to make additional payments. If you are owed a refund, it will be deposited directly into your bank account.
Final Thoughts
Filing a tax return in Germany may seem complex, but using the right tools can make the process significantly easier. For an efficient and user-friendly tax filing experience, consider using WISO Steuer, which simplifies the process and ensures you get the maximum refund possible.
By understanding the tax system, knowing your obligations, and utilizing available deductions, you can optimize your financial situation and potentially receive a significant tax refund. Happy filing!
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