Profits from stocks and ETFs? You should know the tax tips

Making more money from money: This is usually the goal of investors. It is always annoying for investors that they end up having to give part of the money to the tax office. This is because interest, dividends and profits from the sale of investment products are subject to tax above a certain amount. For this reason, it is important to know how to save taxes.

The capital gains tax in Germany is currently 25 percent. In addition, there is a solidarity surcharge of 5.5 percent and, if applicable, church tax. The capital gains tax, usually as a so-called withholding tax, is paid by the bank to the tax office and thus settled.

Investors should know these 3 tax tips

Anyone who wants to leave as little money as possible with the tax office should look into clever tax tricks. At the “Femance Event” in Munich, financial blogger Fabian Walter, also known as “Steuerfabi”, revealed 30 tax tips in 30 minutes – including the following three tax tips for investors.

1. Submit exemption order

Investors only have to pay taxes on capital gains if they exceed the tax-free allowance for capital gains. Since 2023, this has been 1,000 euros per year. “Investors who pay up to 1,000 euros in capital income per year do not have to pay taxes.” “Anyone who exceeds this amount, for example 1,200 euros, has to pay capital gains tax on the 200 euros,” explains Walter.

In order to secure the exemption order, investors must submit a so-called exemption order to the custodian bank or to the Neo Broker. Otherwise, the tax will be automatically paid to the tax office.

2. Apply for a more favorable tax assessment if your income is low

Anyone who has a very low tax rate and falls below the basic allowance of 11,604 euros can apply for a more favorable assessment. What is the basic allowance? The basic allowance serves to secure the minimum subsistence level. Taxable income that is below this is not subject to income tax.

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3 tips from “Steuerfabi” to save taxes on real estate

“In the tax return, there is a tab called ‘Anlage KAP’. This is where you enter your capital income. “If you then tick the box for the preferential assessment at the top right and your tax rate is below 25 percent – i.e. below the percentage of the withholding tax – then you will get the withholding tax you paid back in full,” explains Walter.

Investors who are below the basic allowance can also apply for a so-called NV certificate (non-assessment certificate) from the tax office and thus save taxes. “Anyone who receives this certificate, which is usually valid for two years, can submit it to the bank and no capital gains tax will be deducted,” says Walter.

3. Create an investment allowance in case of repeated high income

If someone receives particularly high income in one year, they can also save taxes – by creating an investment allowance. However, the tax professional warns in advance: “Taxpayers should really only do this if they had extremely high income in one year.”

How high is the investment allowance? “Taxpayers can create an investment allowance for movable assets,” explained Walter. This includes investments such as photovoltaic systems (over 30 kilowatts peak) or a tiny house – at least if it is movable and has wheels. Taxpayers can then create an investment allowance for the investments mentioned in the following year.

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