Natural persons who have neither their place of residence nor their habitual residence in Germany can still be taxable with certain income. This limited tax liability results from § 1 (4) and § 49 EStG. § 49 paragraph 2 EStG regulates the so-called isolating approach. It ensures that only domestic tax characteristics can influence the allocation of income.
Principle 1: Restricted taxable income according to § 49 EStG
§ 1 EStG regulates unlimited tax liability. Unlimited taxable persons are all natural persons who in Germany either
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.