Germany » Taxes

Income Tax	VAT	Real Estate Tax	Transfer Tax

Income Tax

A property owned by a company and generating an income is subject to a tax of 38.34% average. An individual who meets the test of a"permanent resident"of Germany will have the tax calculated on his income in Germany and from overseas. A foreign resident who is employed in Germany pays tax only on income earned in Germany. Income tax imposed on an individual in Germany is 15 - 42%.

VAT

From 1.1.2007 the new VAT rate in Germany is 19%, compared to 16% in 2006.

Real Estate Tax

The tax is imposed on real estate that is located in Germany. The taxes are transferred to the local authority in which the property is located. The rate of tax is 3.5%.

Transfer Tax

The tax is imposed on the transfer of real estate and securities. On purchasing securities the tax is applied only on purchasing more than 95% of the share capital or more of a body that deals in real estate.