Filing a tax return in Germany is intimidating—especially if you question whether you’re legally required to submit one. The good news? The rules are relatively straightforward once you break them down. Below, we’ll explain who must file, under what conditions, and why even those who aren’t required may benefit from filing anyway. We’ll also cover key deadlines, potential penalties, and how to make the entire process effortless.
Mandatory filing (Pflichtveranlagung)
Self-employed (freelancers & tradepeople)
If you’re self-employed—whether as a freelancer or a tradesperson (Gewerbe) —you always need to file a tax return (Einkommensteuererklärung), regardless of how much you earn. Any amount above that threshold is taxed as soon as your income exceeds the basic tax-free allowance (Grundfreibetrag). The Grundfreibetrag for 2025 is 12.084 €.
Employees: When is it mandatory?
Many employees in Germany are not obligated to file a tax return—your employer withholds income tax (Lohnsteuer) directly from your wages. However, certain situations trigger a mandatory filing, including:
Multiple employers or side income
If you receive income from more than one employer simultaneously and one job uses tax class VI.
If you have taxable side income (Nebeneinkünfte) of more than €410 a year—e.g., rental income or overseas interest.
Wage replacement benefits over €410
Examples: Short-time work allowance (Kurzarbeitergeld), unemployment benefits (Arbeitslosengeld I), parental allowance (Elterngeld), and sick pay (Krankengeld).
These benefits are typically tax-free but increase your overall tax rate through the “progression clause” (Progressionsvorbehalt).
Tax allowances (Freibeträge)
You must file a return if you requested a tax allowance from the Finanzamt (e.g., for job-related expenses, special expenses, or extraordinary burdens). This ensures that the actual expenses match what was deducted in advance.
No filing requirement applies if your total annual wage stays below certain thresholds (which change yearly).
Married couples or registered partners with certain tax classes
If one partner uses tax class V or VI, or if both spouses opt for tax class IV with factor.
If one spouse chooses a separate assessment (Einzelveranlagung).
If you or your partner lives abroad but is treated as a German tax resident.
If you’re widowed or divorced and remarry in the same year, you generally need to file.
Extraordinary payments & the fünftel rule
For instance, severance pay (Abfindung) that was taxed using the “fünftel rule” to reduce the tax impact.
If you switch employers and receive certain bonuses (like Christmas or vacation pay), but the new employer didn’t consider your previous salary.
Previous-year losses (Verlustvortrag)
If you declared a loss carried over from a prior year, you must keep filing until that loss is offset by positive income.
Foreign residency
You must file if you live abroad but opt for unlimited tax liability in Germany.
Retirees & pensioners over the basic allowance
If your pension exceeds the annual basic allowance.
For civil servants receiving a pension (Versorgungsbezüge), taxes are withheld monthly, but you may still need to file if any of the triggers above apply.
Voluntary filing (Antragsveranlagung)
Just because you’re not required to file doesn’t mean you shouldn’t consider it. In Germany, voluntary filers often get money back—on average around €1,000. Why?
Unclaimed expenses: If your actual job-related expenses (Werbungskosten), special expenses (Sonderausgaben), or extraordinary burdens (außergewöhnliche Belastungen) exceed standard allowances, you only see a tax benefit if you file.
Multiple years to claim: Voluntary filers have up to 4 years from the end of the tax year to submit (until December 31). You may have up to 7 years if you have a loss carryforward.
Filing once voluntarily doesn’t lock you into filing every year. You can decide annually whether it’s worth it.
Deadlines & penalties
Deadlines
Mandatory filers: Typically, these must be submitted by July 31 of the year following the tax year (or the next business day if it falls on a weekend/holiday). Some years have extended deadlines (e.g., due to recent temporary legislation). For tax year 2023, the deadline is September 2, 2024. For 2024, it’s July 31, 2025.
Voluntary filers: Have until December 31, four years after the respective tax year ends. So, your 2023 voluntary return can be submitted by December 31, 2027.
Penalties for late or missing returns
If you’re required to file but don’t do so on time, the Finanzamt can impose:
Late-filing penalty (Verspätungszuschlag): Often 0.25% of your unpaid tax per month, with a minimum of €25 a month.
Coercive fine (Zwangsgeld): Ranges from €100 to €25,000 in extreme cases.
Official tax estimate: If you fail to file, the Finanzamt can estimate your taxes (usually on the high side). You have one month to object and submit your actual return.
How Norman can help
Whether you’re self-employed, a freelancer, or an employee, Norman can simplify your tax life by:
Automating data entry: Upload payslip or receipts and Norman will automatically extract the data.
User-friendly interface: No tax degree required.
Maximize tax deductions: Norman automatically offers relevant tax deductions and proactively provides tax tips.
Expert guidance: Easy instructions that ensure you don’t miss any tax advantages.
Filing securely: Submit your return directly to the Finanzamt.
If you’d rather focus on your core business or daily life, Norman’s streamlined approach can help make tax filing quick, accurate, and stress-free.
FAQ
Am I automatically required to file every year if I do it once voluntarily?
No. Voluntary filing is an annual choice unless a legal trigger (like side income over €410) applies.
Can I be penalized for mistakes?
Accidental errors aren’t automatically considered tax evasion. Correct them quickly if you spot any. Severe negligence or intentional mistakes can carry harsher penalties.
What if I’m a retiree?
You must file if your total income, including your pension, exceeds the basic allowance or if any other mandatory trigger applies.
Is it worth filing if I’m not obligated?
Often, yes. Many find they’re owed a refund of ±1.000 € due to unclaimed deductions.
How do I know my potential refund?
Tools like Norman can help you estimate your tax liability or potential refund before you submit it.