How does the recovery of taxes wrongly paid due to double taxation work?
January 27, 2023 | 120,00 EUR | answered by Yvonne Schreiber
Dear tax advisor,
I am contacting you because I recently discovered that I have paid taxes unjustly due to double taxation. The situation is as follows: I have income from both Germany and another country where I have worked temporarily. Due to the existing double taxation agreements between the two countries, my income was taxed in both Germany and the other country. As a result, I have paid more taxes than necessary.
This double taxation is causing me great concern, as I fear that I will not be able to recover the excess money paid. Therefore, I would like to know how the recovery of taxes paid unjustly due to double taxation works. Are there any specific procedures or deadlines that I need to be aware of? What documents are needed to start the process?
I would be very grateful if you could assist me and provide possible solutions to help me recover the excess money paid. Thank you in advance for your support.
Sincerely,
David Mattes
Dear Mr. Mattes,
Thank you for your inquiry regarding double taxation and the refund of incorrectly paid taxes. Double taxation occurs when a taxpayer earns income in more than one country and both countries have the right to tax that income. To prevent you from paying more taxes than necessary, there are usually double taxation agreements between the countries involved.
In your case, if you have earned income in both Germany and another country, and both countries have taxed that income due to the double taxation agreement, it is possible that you have incorrectly paid taxes. To reclaim the overpaid money, there are various steps you can take.
Firstly, you should consult a tax advisor specializing in international tax law and double taxation. They can help you initiate the exact steps to reclaim the overpaid taxes. Typically, you will need to file a request for refund detailing your income and the taxes paid in both countries.
It is important to provide all relevant documents to expedite the process. This includes income statements, tax assessments from both countries, any certificates of taxes paid in the other country, and any other relevant documents.
There are no set deadlines for reclaiming incorrectly paid taxes due to double taxation, but it is advisable to start the process as soon as possible to avoid any statute of limitations.
I hope this information is helpful to you and that you can successfully reclaim your overpaid money. If you have any further questions or need assistance, I am at your disposal.
Sincerely,
Yvonne Schreiber
Tax Advisor
