Taxation of international executives
Are there social security/social insurance taxes in Germany? If so, what are the rates for employers and employees?
The following rates have to be applied against the gross salary, with the ceilings indicated.
|Type of Insurance||Paid by employer||Paid by employee||Total|
|Annual** EUR (Ceiling)||Monthly** EUR (Ceiling)|
* Plus 0.25 percent surcharge on nursing insurance to be borne by employees without children.
**The ceiling for pension and unemployment insurance applicable in the Eastern Bundeslaender (former German Democratic Republic) is EUR57,600 per year and EUR4,800 per month.
The employer is liable for the total payment, which must be made on a monthly basis. Exemption may be granted under the EU rules or a bilateral social security agreement.
Are there any gift, wealth, estate, and/or inheritance taxes in Germany?
Inheritance and gift tax is assessed on the transfer of property by reason of death, gifts during lifetime, and transfers for certain specified purposes, as well as on the net worth of certain family foundations or trusts.
Worldwide assets are potentially liable to this tax if the transferor or the transferee is resident in Germany at the relevant time. Otherwise, it applies only to assets situated in Germany.
Taxable transfers of property are subject to inheritance and gift tax at graduated rates, depending on the value of the property and the family relationship of the respective individuals. The rates vary from 7 percent up to 50 percent.
Since 1997, there has been no net worth tax in Germany.
Are there real estate taxes in Germany?
Yes. The tax is levied on the assessed value of the property using the basic tax rate of 0.35 percent. On the resulting base amount, the municipalities apply their respective multipliers to arrive at the final tax due.
Are there sales and/or value-added taxes in Germany?
The standard VAT rate for supplies and goods of services is 19 percent. For certain goods and services, the VAT tax rate is 7 percent.
Are there unemployment taxes in Germany?
The rate for unemployment tax is 3.0 percent.
Are there additional taxes in Germany that may be relevant to the general assignee? For example, customs tax, excise tax, stamp tax, and so on.
This tax is generally imposed on any transaction that causes a change in the ownership of real estate property situated in Germany. The tax rate is generally 3.5 percent (up to 5 percent in some locations).
Local taxes are levied only on income from trade or business
© 2017 KPMG AG Wirtschaftsprüfungsgesellschaft, ein Mitglied des KPMG-Netzwerks unabhängiger Mitgliedsfirmen, die KPMG International Cooperative (“KPMG International”), einer juristischen Person schweizerischen Rechts, angeschlossen sind. Alle Rechte vorbehalten.