Taxes - Accounting

Germany

Print the page Click to print the page

Tax Rates | Accounting Rules

Tax Rates

Consumption taxes

Nature of the tax: Value Added Tax (VAT) called Umsatzsteuer (USt)
Tax rate: 19%
Reduced tax rate: A reduced rate of 7% is applied to food, public transport, books and magazines and other products.
No rate is applied to exports.
Other consumption taxes: Company expenses are also subject to VAT (Vorsteuerabzug) at the rate of 19%. For more information refer to the German investement promotion agency.

Corporate taxes

Tax rate

The corporate tax (Körperschaftssteuer)	The standard rate is 15%. The effective corporate tax rate including trade tax (assessed independently by each municipality: from 7% to 17.5%) and solidarity tax (5.5%) is about 30-33%.
Trade tax (Gewerbesteuer) is also assessed on companies. This tax is discharged by any person (physical or moral) carrying on a commercial activity or industrial in Germany. Trade tax is a deductible expense as a running cost for corporate income tax purposes. The trade tax amount depends on the rate voted by the concerned municipality, multiplied by a coefficient.	The effective rate varies from 14% to 17% depending on the municipality.

Tax rate for foreign companies: Resident and non-resident companies are charged in the same way concerning consumption tax.
Capital gains taxation: For capital gains on asset disposal, there is a single tax rate of 15% (+ a surcharge of 5.5%).
Capital gains from share transfer in resident and non-resident subsidiaries are exempt from corporate tax up to 95%, whatever the stock and the length of time it has been held.
Main allowable deductions and tax credit: Companies can carry forward their former loss limited to EUR 511,500. Furthermore, they can carry forward their loss on the payment of interests which is deductible up to 30% of the EBITDA (Profits before interest, tax, depreciation and amortization).
Other corporate taxes: In addition to federal and lander taxes, municipal taxes apply, at varying rate from one municipality to the other.

Individual taxes

Tax rate

Personnal Income Tax	Progressive rate from 15% to 42%
From EUR 0 to 7,665	0%
From EUR 7,665 to 12,739	Progressive rate from 15% and 23.9%.
From EUR 12,740 to 52,151	Progressive rate from 23.9% to 42%.
Beyond EUR 52,151	42%
A surcharge must be added. It concerns a solidarity contribution.	5.5% of the amount of the taxable income.

Allowable deductions and tax credit: Insurance bonuses, education and training expenses, retirement expenses, alimony, donations and expenses related to disability are deductable.
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).

Double taxation treaties

Countries with whom a double taxation treaty have been signed: Centre for German Legal Information (CGerLI)
Withholding taxes: Dividends: 25%, Interest: 0%, Royalties: 15%/30%
Bilateral agreement: Germany and Tunisia are bound by a double taxation treaty: yes

Signed	Ratified	Enforced
23/12/1975	Law 76-57 of 11/06/76	19/11/1976

Pour aller plus loin dans vos recherches nous vous proposons de connaître les taxes locales connaître les taxes locales qui s'appliquent à votre produit.

Sources of fiscal information

Tax Authorities: The tax department; The Federal Finance Bureau
Other domestic resources: Tax information portal

Accounting Rules

Tax year: The tax year begins on 1 January and finishes on 31 December of the same year.
Accounting standards: Accounting priciples and regulations in Germany are in the "German Accounting Standards" - GAS (Deutsche Rechnungslegungs Standards - DRS) which are published by the German standardization bureau: the Deutsches Rechnungslegungs Standards Committee (DRSC). There is no compulsory official accounting plan in Germany. It is up to each company to choose the form, the language and the currency. European companies listed on the stock exchange must establish their annual consolidated accounts on the basis of the IAS/IFRS standards.
Accounting regulation bodies: DRSC
Accounting reports: Unlimited liability companies and partial liability companies (Einzelkaufleute, OHG, KG) must draw up the following accounting documents:
- a balance sheet (Bilanz) in the format decreed by the 4th European Directive of 1978, adapted to German law in 1985;
- a profit and loss account (Gewinnund Verlustrechnung).
Limited liability companies (Gmbh and AG) must add to the two documents above:
- notes to the accounts (Anhang);
- an annual report (Lagebericht).
The financial flow table or cash flow table is not obligatory, except for companies listed on the stock exchange.
Publication requirements: The obligations of companies relative to the reporting of their accounts depend on their legal form: small company, medium company and large company (defined according to the total of the balance sheet, the net turnover and the members of staff employed).

Limited liability companies (Gmbh et AG), with the exception of small companies and groups of companies, must publish annual accounts and have them controlled by an outside auditor. On the other hand, unlimited liability companies (except KGaA) have no obligation to publish their accounts nor to have them audited.
Professional accountancy bodies: WPK - Wirtschaftsprüferkammer
IDW - Institut der Wirtschaftsprüfer
Certification and auditing: The preparation of the annual accounts must take place less than three months after the end of the financial year for medium and large companies, and less than six months later for small companies.
Vous pouvez contacter un auditeur externe : Price Waterhouse Coopers ; Ernst & Young (en allemand); KPMG (en anglais) ; Deloitte & Touche (en anglais)
Accounting news: International Accounting News on Germany