German Income Tax : German Payroll Solutions : EAFS Consulting GmbH

You can find general information on income tax rates here, in relation to Germany. This guide also covers the income tax base for residents and non-residents, allowable tax credits and deductions, the special expatriate tax regime, capital income tax rates and information on double-taxation treaties.

Income Tax Base For Residents and Non-Residents of Germany

Residents of Germany: are subject to personal income tax on their total income, from all sources worldwide.
Non-residents of Germany: are subject to personal income tax on German sourced income only.

Individuals will be regarded as tax residents if:

Their main home or center of economic interests is in Belgium.
They are registered within the civil register.

A surcharge must be added, of 5.5% of the amount of income tax, if it concerns a solidarity contribution. Within Bavaria and Baden-Württemberg there is also a 9% Church Tax.

Allowable Deductions and Tax Credits

Insurance bonuses, education and training expenses, retirement expenses, alimony, donations and expenses related to disability are all deductible.

Special Expatriate Tax Regime

Germany has signed avoidance of double taxation agreements with many countries in the world. For more information refer to the Ministry of Finance (German only).

Capital Tax Rate

No special capital gains tax.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed: Centre for German Legal Information (CGerLI), Access the list of Double Taxation Treaties signed by Germany
Withholding Taxes Dividends:: Dividends: 25%, Interest: 0%, Royalties: 15%/30%
Bilateral Agreement: The United Kingdom and Belgium are bound by a double taxation treaty.