Tax revenues were at a record high in 2017

In 2017, the total tax revenue from the five categories amounted to almost EUR 700 billion. The state operates with a black zero, but the distributions to citizens demanded by some parties have so far failed to materialize.

The high tax revenues are mainly due to the good economy and on attributed to the low unemployment rate. Wages and salaries have also risen continuously in recent years, in many industries. As a result, workers earn so much money that they become taxable.
Anyone who has less than EUR 9,000 taxable income per year is tax-exempt. (As of 2018) The starting tax rate is 12 %, the top tax rate that single earners pay annually with a taxable income of EUR 100,000 or more is 42 %. In between, the progression ensures that increases in wages or income are sometimes completely absorbed by the tax and the employee does not notice them.

Largest share of income from community taxes

With almost EUR 540 billion they make Community taxes accounted for the largest share of tax revenue in 2017. The wage and income taxes belong to the community taxes. Value-added tax and corporation tax, which companies have to pay, also make up their share of Community taxes.

Employers and employees are equally responsible for paying the Income tax as committed as traders, self-employed and freelancers. The employee's tax deduction takes place automatically with the monthly wage and salary statement. the Payroll accounting transfers a discount to the tax office. This is based on the valid tax tables. The employee can repeat overpaid taxes at the beginning of the following year with the tax return. There he claims expenses that are recognized by the tax office and then reimbursed to the employee's account.

The self-employed pay a quarterly discount to the tax office and determine the actual tax to be paid at the end of the year by means of an income-surplus account or by drawing up a balance sheet. This is necessary if the company posts more than EUR 60,000 in profit annually.

Double taxation is common

Many products and services are taxed multiple times in Germany. Buyers of land, for example, pay a real estate transfer tax. This is always due when the property changes hands. While real estate transfer tax has to be paid once when buying a house or property, real estate tax is due annually. This is one of the municipal taxes, which, after community taxes, make up the largest item in overall taxation.

Property taxes are collected from cities and municipalities. They must be paid by both private and commercial property owners. Commercial property owners are assessed with property tax A, while private property owners are assessed according to the assessment rate of property tax B.

While the Property tax is usually paid from the income, the real estate transfer tax is often part of real estate financing. Sometimes it is served from the real estate loan.

According to the experts from, interest in real estate financing and the associated demand for real estate loans among German citizens remains high. One of the reasons for this is the still low interest rates that make borrowing so attractive.

which Tax saving models in combination with real estate are useful, but must be clarified individually with a tax advisor or real estate specialist.