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Income tax return preparations
In Japan, it is uncommon for individuals to file final tax returns as employers withhold income tax from salaries and make year-end adjustments.
Conversely, in Germany tax is withheld, but no year-end tax adjustments are made, hence it becomes vital to individually file final tax returns.
We assist individual clients who need to file tax returns in Germany, such as employees assigned to or employed locally in Germany, by preparing and submitting their tax returns.
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Frequently asked Questions
Frequently asked questions regarding the preparation of income tax returns.
Q. . I was dispatched to Germany on 1st March and have received salaries and bonuses from Japan. When will I be subject to taxation in Germany?
A. . If you have been residing in Germany for an extended period, your taxation will commence from that point forward. Bonus taxation is calculated pro rata for the duration of your stay in Germany, as the place of employment is primarily taxed in accordance with the Japan-Germany tax treaty.
Q. What are some examples of taxable fringe benefits in Germany?
A. Examples include:
- Company-provided housing, rental allowance
- Company car
- Company-paid portion of private health insurance premiums exceeding a certain limit
- Compensation for school tuition fees for children other than kindergarten
- Medical expenses covered by the company, etc.
- Temporary return expenses for family members other than the individual.
Q. Mobile phones for business purposes are not provided, and employees use their personal mobile phones for work-related communication. Can employers provide tax-exempt compensation for this business mobile phone usage?
A. Up to 20% of the monthly bill may be exempt from tax without needing to proof. However, there are limitations, so caution is advised.
If you have any questions, please do not hesitate to contact us.