Income tax refund

Did you have employment income in the past years in Germany ? Then you might have the opportunity to get a material income tax refund.

Usually material income tax and social security contributions get deducted from employees working in Germany. Those monies are withheld monthly by your employer and never appear on your bank account. Filing an income tax declaration might under certain circumstances help you to get a material refund.

Does every employee in Germany get an income tax refund?

Tax law is complicate and influenced by many factors. A non-married employee without children who works Jan – Dec in a calendar year and gets 12 times the same salary without having any tax-relevant costs to deduct will usually not get back anything.

If your case is different from the above mentioned, it is highly likely you get tax back. Here some criteria that usually result in material tax refunds. If only one is met, you should get a refund:

  • You did not work from January  to December in a particular calendar year but you started your employment later or ended it earlier (e.g. March to December or January to September)

  • Your salary was not always at the same level but there were changes in some months, e.g. a bonus or a lift in your salary

  • Your husband or wife was with you in Germany and had none or only immaterial income

  • You kept your house / apartment at your home and rented a hotel room or apartment in Germany for job purposes

  • You had high tax deductable costs, e.g. for housing, traveling from your home to your job, communication costs, business dinners, IT-costs, education costs,….

Do I have to file an income tax declaration according to German tax law?

If you only had income as employee in Germany, the answer is generally No. Your tax was already withheld from your employer and paid to tax office. But you can file the tax return  voluntarily and in the cases explained above you should do it as you probably will get back some hundreds or thousands of EUR.

How much time do I have to file my income tax statement?

The ground rule is: You can file your tax return 4 years after year end. This means e.g. in the year 2014, you can file the years 2010, 2011, 2012 and 2013.

2009 and older would usually no longer be accepted by tax office as those years are time-barred.

How much fees will be charged to me for preparing the return?

The fees of our accounting firm primarily depend on volume of time we have to spend. In no case you will have a bad surprise with the fees:

You contact us and provide us the relevant key information of your case. We make a first analysis for free and can tell you how much tax refund you likely get. We then make a quote to you. Then you can decide whether to stop or to proceed with our services. Therefore you have full cost control with our company and no bad surprises re possible.

Why should I choose a German accountant to prepare my German income tax return instead of an international acting accounting firm?

Those international accounting networks do usually neither have the language nor the technical skills to prepare German tax returns. They are ‘mid men’ who are specialized in marketing and collecting clients. Having gained you as a client t they pass the work to local accountants they are cooperating with.  You pay a commission to the ‘mid man’ and the work is done by other local accounting firms. You never get directly in contact with the people who actually process your tax return and the response time behavior is often poor.  This is what we heard from many of their disappointed former clients.