Germany: Worked Example of Tax on Rent
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Tax Example: Rent
| Non-resident couple's joint monthly rental income1 | €1,500 | €6,000 | €12,000 | |
| Annual Rental Income | 18,000 | 72,000 | 144,000 | |
| Less Costs2 | (1,500) | (5,100) | (9,200) | |
| Less Depreciation3 | (5,701) | (20,160) | (40,320) | |
| = Taxable Income | 10,799 | 46,740 | 94,480 | |
| Income Tax Rates4 | ||||
| Income Tax Due | 2,700 | 2,700 | 23,963 | |
| Annual Income Tax Due | €2,700 | €11,685 | €23,963 | |
| Surtax | ||||
| Solidarity surcharge5 | 5.5% | 148 | 643 | 1,318 |
| Annual Income Tax Due | €2,848 | €12,328 | €25,281 | |
| Tax Due as % of Gross Income | 15.82% | 17.12% | 17.56% | |
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DISCLAIMER: The information contained above is marketing material only and is not written tax advice directed at the particular facts and circumstances of any person and should not be relied upon. We encourage you to discuss your particular situation with us or an independent tax advisor. This information was last updated on march 15 2007.
Notes
Grant Thornton Germany is a member firm of Grant Thornton International. Grant Thornton International is not a worldwide partnership. Member firms of the international organization are independently owned and operated.
1 The property is jointly owned by husband and wife.
2 Estimated values. Actually incurred expenses effectively connected with the property can be deducted from the gross rental income to arrive at the taxable income (property management fees, maintenance and repairs, etc.).
3Depreciation is available on the building only, not on the land. For properties with land, it is assumed that 70% of the total costs accounts for the building.
4Minimum average tax rate for non-EU residents is 25%.
5The 5.5% solidarity surcharge is levied on the annual income tax liability.
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Your Comments
posted by Emmanuel Petitjean | 2008-01-12
Engineer, Duesseldorf
Hi There,I am of the opinion that your German Tax example is wrong. The latest column with a monthly rental income of 12000EUR, which gives a taxable income of 94480EUR, probably commands more than 24000EUR of taxes, because at this level this would represent a taxation level of 25.3%. I calculate myself 31474EUR, which represents about 33% tax.Please advise and correct if needed,Regards,Emmanuel
posted by Fredrik | 2008-01-21
Luxembourg
Is the 7664 € tax exception level applicable for non -residents?Thanks for very good info.Best regardsFredrik Svensson