Capital income within the meaning of Section 20 of the Income Tax Act (EStG) is treated particularly favourably for tax purposes. With the separate tax rate for capital gains according to § 32d EStG, the tax burden in most cases is a maximum of 25 %. Exceptions are possible and in practice especially relevant for GmbH shareholders and intra-family businesses. The legislator even grants you the right to vote.
We all know (and love) German tax law with its principles and exceptions. Fortunately, § 32d EStG is relatively simple and logical, because in § 32d (1) sentence 1 EStG, the legislature first regulates the basic case: income from capital assets according to § 20 EStG, if they are part of the private assets, are subject to a flat-rate tax rate of 25 %.
The income tax may include the solidarity surcharge with 5.5% of the tax amount and, if applicable, church tax. In contrast to all other types of income, church tax amounts attributable to capital gains are excluded from the special expense deduction of § 10 (1) no. 4 EStG.
Basis of assessment for the 25% capital gains tax according to § 32d EStG is the income from capital assets, determined by deducting the savings lump sum according to § 20 paragraph 9 EStG from the income according to § 20 paragraph 1 or 2 EStG. The savings lump sum is EUR 801 per person, whereby spouses who are assessed together may set a savings lump sum of EUR 1,602.
§ 32d paragraph 6 EStG regulates the so-called favorable examination. The separate tax rate for capital gains shall not apply if:
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.