Double household situation

  • Expenses in connection with a double household will generally result in a reasonable deduction and consequently lead to either lower tax payments or a higher tax refund.
  • Apart from the maintenance and use of two different households, additional prerequisites also need to be fulfilled.
  • Tax authorities generally see this issue critically, as it could help you save quite a considerable amount of tax.
  • We recommend discussing this matter with us in good time to avoid any disadvantages later on.

Deferred salary

  • If you receive a salary or bonus payment from sources outside of Germany during the time you are (again) living in Germany, the question arises regarding in which country the income is taxable. In general the payment is tax-free in Germany if it was paid for work performed outside of Germany and a Double Taxation Agreement is applicable.
  • If you have an unlimited tax liability in Germany you will need to prove that this income has already been taxed (e.g. by means of an income tax assessment notice issued in a foreign country).
  • Even if the income is not taxable in Germany, it has to be reported in your German income tax declaration, as it must be considered in respect of the progression clause.