Menu
Often discussed within the recent days due to the Covid-19 situation: the short-time work allowance.
The short-time work allowance is a compensation payment which you receive from the Federal Employment Agency. Although this is tax-free, it is subject to the so-called progression clause. This means that the short-time work allowance you receive will be taken into account when calculating your individual income tax rate, thus increasing it. The increased tax rate will then be applied to your taxable income only (excluding tax-free income – such as short-time work benefits). This usually results in a tax liability so a payment from your end to the tax office (depending on other income and factors). Just as important: you are obliged to file an income tax return for each year in which you have received more than EUR 410 in short-time work benefits.
The above rules and tax obligations also apply to other wage replacement benefits such as parental allowance, unemployment benefit or sickness benefit.
Meerle will gladly support you with detailed advice and/or the preparation of your income tax return.
Often discussed within the recent days due to the Covid-19 situation: the short-time work allowance.
The short-time work allowance is a compensation payment which you receive from the Federal Employment Agency. Although this is tax-free, it is subject to the so-called progression clause. This means that the short-time work allowance you receive will be taken into account when calculating your individual income tax rate, thus increasing it. The increased tax rate will then be applied to your taxable income only (excluding tax-free income – such as short-time work benefits). This usually results in a tax liability so a payment from your end to the tax office (depending on other income and factors). Just as important: you are obliged to file an income tax return for each year in which you have received more than EUR 410 in short-time work benefits.
The above rules and tax obligations also apply to other wage replacement benefits such as parental allowance, unemployment benefit or sickness benefit.
Meerle will gladly support you with detailed advice and/or the preparation of your income tax return.
Due to a change in the law which applies for the first time to the 2020 assessment period, the following special feature must be noted: If you no longer have a residence or habitual abode in Germany and your employer allocates or issues you a salary component such as a severance payment or stock options and these have been taken into account with the 1/5 rule within your (subsequent) German salary statement, you are obliged to file an income tax return in Germany. Meerle will gladly advise you on this and prepare your income tax return for you.
Due to a change in the law which applies for the first time to the 2020 assessment period, the following special feature must be noted: If you no longer have a residence or habitual abode in Germany and your employer allocates or issues you a salary component such as a severance payment or stock options and these have been taken into account with the 1/5 rule within your (subsequent) German salary statement, you are obliged to file an income tax return in Germany. Meerle will gladly advise you on this and prepare your income tax return for you.
Hermann-Vogel-Str. 7
80805 München
team@meerle-tax.de
Tel. 089 904 2205 80