Moved to Germany

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Topic Author
konik
Posts: 88
Joined: Mon Aug 17, 2020 2:44 pm

Moved to Germany

Post by konik »

Hi all!

I have recently became a german tax resident and now I'm trying to understand what does it mean for my portfolio.

1)I have Interactive Brokers and possibly move to TradeStation Global in a couple of months. Do they report taxes to Germany or should I fill the tax declaration myself? Should I do it, if my dividends and realised gains are lower than 410 euro and hence have 0% tax bracket?

2)Are there any difference between Ireland and Luxembourg domicile for me?

3)I haven't found any good investment wrapper of co-funding scheme, but maybe I missed smth?

Thanks!
Target2019
Posts: 893
Joined: Sat Mar 03, 2007 4:30 pm

Re: Moved to Germany

Post by Target2019 »

Are you a US citizen? If so, then your broker was sending 1099's to your US tax home, and will continue to do so until you change your address.

You really should get in contact with an expat forum and start to read/analyze what is being discussed about taxes.

What I read is that Germany taxes all income earned while you are a resident. Companies like the following have some information, but you really need to explore what your responsibilities are.
https://www.greenbacktaxservices.com/bl ... any-taxes/

Since the US has a citizen-based tax system, and Germany's is residency-based, I imagine it can become more complicated than I've described.
Topic Author
konik
Posts: 88
Joined: Mon Aug 17, 2020 2:44 pm

Re: Moved to Germany

Post by konik »

No, I'm Russian citizen, so no weird citizenship-based taxation. While I was Russian resident IB indeed sent 1099 form to the US and I needed only to pay a fraction of the tax in Russia. I believe the situation is similar in Germany.

My question is if IB also sends this information to german government or not?

Expat forums are good to discuss the income tax (like salary), but quite few are dealing with capital gain tax and dividends, so I hope BH is better place for that.
EmperorPenguin
Posts: 11
Joined: Mon Mar 01, 2021 1:57 am

Re: Moved to Germany

Post by EmperorPenguin »

Hi Konik, I spent a lot of time dealing with this constellation (IB in Germany).

IB does not send it to the German tax authorities; you'll have to file for it yourself. It's easiest with a tax filing software, which usually cost about 20€ a year (and tend to have good ROI) and can help you with doing some other things in an efficient way. Otherwise you can do it on a paper form that is also easy to understand after you've done it once.
As an aside, I do not know how good the IB tax optimization feature is for the German tax system, but maybe it's also something worth looking into.

As for the US forms, IB can do that for you. There are also a number of brokers in Germany which serve as wrappers for IB (for example, Lynx) and help with some of the administrative stuff including US forms. In essence they are local support that on-board you and help with troubleshooting for small individual investors.

What do you mean by: " 3)I haven't found any good investment wrapper of co-funding scheme, but maybe I missed smth?" I think I can guess what this is about, but maybe elaborate first. :) I hold equity both as an individual as well as via a limited company, so know some bits here and there (although not giving out official tax advice, of course).
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