Capital from abroad to Germany
February 6, 2014 | 30,00 EUR | answered by StB Patrick Färber
Hello,
my wife and I are foreigners. My wife currently has a temporary residence permit. I have a permanent residence permit. We want to bring my wife's capital from abroad to Germany. This concerns money that has been taxed abroad and the property that my wife acquired in 2006. We want to sell the property and bring the money to Germany.
Question 1: Do we have to pay taxes on the money? (a) the capital and b) the money from the sale.) Proof from the bank can be provided. The purchase contract can also be provided. Do these documents have validity in Germany? If we wait until 2016 and then sell the property, would we be subject to speculation tax?
Question 2: We already submitted our tax return jointly last year. We accidentally did not declare my wife's capital abroad. We want to do so this year. Could there be problems with the tax office?
What is the correct procedure now?
Best regards
Dear inquirer,
Based on the information provided, your inquiry can only be answered in a general way as follows:
Starting from the year in which you have a residence in Germany, you are considered to be unlimitedly liable for income tax on your earnings "worldwide."
Question 1:
- Capital itself is not taxable. However, you must indicate in your tax return form that you have a bank account abroad.
- Income from the capital (interest) is taxable if it was accrued during the time you had a residence in Germany.
- The property only becomes relevant for tax purposes if it is rented out. Even if it is/was rented out, the rental income in Germany is irrelevant if the property is located in the EU. If the property is outside the EU, the income is indirectly taken into account through a so-called progression clause, if you have other taxable income in Germany.
- The sale of the property abroad or in a third country is not relevant for Germany, but possibly in the country where the property is located.
Question 2:
- If you did not declare your wife's capital gains (interest, dividends) in the previous year, this may constitute tax evasion. However, you can rectify the situation by fully declaring the undisclosed capital income (interest, dividends, etc.) to the tax office and providing evidence (self-reporting for tax evasion). The tax office must be able to assess the income based on your information without further investigation. If the information is incomplete, the self-reporting will be considered "failed."
I hope this gives you an overview.
Best regards,
Tax Advisor Patrick Färber
