Which countries have a double taxation agreement with Germany?
November 8, 2023 | 120,00 EUR | answered by Guido Hoffmann
Dear tax advisor,
My name is Jessica Kessler and I work as a freelance translator. Lately, I have been receiving more and more orders from abroad and I am therefore concerned about possible double taxation. I am not sure which countries have a double taxation agreement with Germany and how these agreements can help me avoid taxes.
Currently, I am already paying taxes in Germany as I have my residence here. However, if I earn income from abroad, I am worried that I may also have to pay taxes there and thus be double taxed. This would greatly impact my financial situation and I definitely want to avoid that from happening.
That is why I am reaching out to you to get more information about which countries have a double taxation agreement with Germany. Are there specific criteria that need to be met for the agreement to apply? And how can I ensure that I am not double taxed when earning income from abroad?
I would be very grateful if you could assist me and show me possible solutions to avoid this issue. I look forward to your response and am eager to see how you can help me in this matter.
Sincerely,
Jessica Kessler
Dear Mrs. Kessler,
Thank you for your inquiry regarding double taxation as a freelance translator who increasingly receives orders from abroad. I understand your concerns about possible double taxation, as this could significantly impact your financial situation. Therefore, I will be happy to provide you with more information on this topic and show you possible solutions to avoid this issue.
First and foremost, it is important to know that Germany has concluded double taxation agreements with many countries. These agreements are designed to avoid the double taxation of income that could be taxed in both the residence country and the source country. These agreements regulate, among other things, which country has the right to tax certain incomes and how tax credits or exemptions can be applied.
The exact provisions of a double taxation agreement may vary depending on the country, but there are generally some criteria that must be met for the agreement to apply. Firstly, it is important that you can prove that you are tax resident in Germany. This means that your place of living or habitual residence is in Germany. Furthermore, your income in the other country where you receive orders must be taxed there.
To ensure that you are not subject to double taxation, it is essential that you submit all relevant tax returns in both Germany and abroad and pay the respective taxes correctly. Additionally, you should check if there is a double taxation agreement between Germany and the specific country where you earn income.
If there is a double taxation agreement, you can benefit from the provisions of this agreement. Generally, double taxation is avoided either by crediting the taxes paid abroad against German tax or by tax exemption. However, you should also consult with a tax advisor who can assist you in implementing these measures correctly.
I hope this information helps you and enables you to avoid potential issues with double taxation. If you have any further questions or need assistance, please do not hesitate to contact me.
Best regards,
Guido Hoffmann
