Since 01/01/2009, withholding tax is applicable in Germany. This tax is being deducted as PAYE-tax relating to capital yields directly by a banking institution, and is being paid anonymously. Taxation is made relating to capital investments, such as interest yield, dividends and market rate profits relating to securities. This includes shares as well as fund-units, bond issues and subscription warrants. Tax calculation is made basing on a fixed tax-rate of 25 % plus solidarity surcharge (5.5 % of withholding tax), and church tax, if applicable (8 or 9 % of withholding tax) which is independent of the personal tax-rate of a debtor
The Federal Republic of Germany closed double-taxation treaties with many countries. Accordingly, the specific contents can be different for almost each country. In some countries, withholding tax and PAYE-tax are also deducted and paid which can be set-off, partly or wholly. German withholding tax is not being levied abroad. A person liable to pay tax is responsible himself for subsequently reporting any income to local tax authorities for taxation purposes.
For depot accounts which are opened via brokerpoint.de, withholding tax is not deducted. The customer himself has to include it in his annual tax return by attaching a transaction report. As a result, any accumulated speculation profits are available for re-investment during the entire year. This provides a clear advantage compared to depot accounts which are maintained by a house bank.Thus, profits can be set-off against losses. However, you have to take into account that each asset class is calculated separately. Accordingly, profits from share transactions can only be set-off against losses incurred by sale of shares. Losses incurred through Forex transactions can, however, be set-off against any other positive capital yield, e.g. interest and dividends. If you have further questions, please contact your tax consultant. Information about your financial structure can be found in real-time in your depot.