Tax Return — Tax Settlement in Germany

Introduction / Who is it for

Steuererklärung (annual tax return) in Germany is VOLUNTARY for most employees, but often very profitable — the average refund is ~1,100 €. However, it is mandatory for certain groups. Deadline: July 31 of the following year (or February 28 of the following year if using a tax advisor).

Who MUST file a Steuererklärung

• Self-employed and freelancers
• Employees with additional income above 410 €/year (e.g., rental income)
• Couples with chosen tax class III/V or IV with factor
• Receiving Krankengeld, Arbeitslosengeld, Elterngeld, Kurzarbeitergeld above 410 €
• Long-term employees (Lohnsteuer deducted in >1 job)
• Receiving tax allowances (Freibetrag) on the tax card
• Having foreign income
• Divorcees whose spouse remarried in the same tax year

Who can VOLUNTARILY file (Antragsveranlagung)

Most regular employees (class I, II, III, IV without factor) can file voluntarily. They have 4 years to decide (e.g., in 2026, you can file for 2022). If you get a refund — great, if an overpayment — often the office does not enforce it (for voluntary filings).

Deadline

• July 31 of the following year (mandatory) — e.g., for 2025: by 31.07.2026
• With a tax advisor or Lohnsteuerhilfeverein: until the end of February of the third year — e.g., for 2025: by 28.02.2027
• Voluntary: 4 years to file — for 2022 until the end of 2026

What can be deducted (most popular)

Werbungskosten (work-related expenses)

Flat rate: 1,230 €/year automatically. Above this, you can deduct precisely:

• Commuting to work — 0.30 €/km (one-way trip); 0.38 €/km from the 21st km
• Home office — 6 €/day, max 1,260 €/year (210 days)
• Work outside home (Auswärtstätigkeit) — allowances + accommodation
• Professional materials (books, tools, computer)
• Training (courses, certificates, industry books)
• Industry subscriptions
• Tools, work clothing

Sonderausgaben (special expenses)

• Health insurance contributions (above mandatory contributions)
• Riester / Rürup contributions (for retirement)
• Donations to charitable causes (up to 20% of income)
• Membership fees for religious organizations
• Language courses (if required for work)

Außergewöhnliche Belastungen (extraordinary expenses)

• Medical costs above "zumutbare Belastung" (1-7% of income)
• Care for parents
• Support for relatives in Poland (Unterhaltszahlungen)
• Funeral costs for close relatives
• Divorce (legal costs)

Support for family in Poland

You can deduct up to 10,908 €/year (2026) for supporting a relative in Poland if:

• The relative has no significant income
• You send documented bank transfers (NOT Western Union)
• The relative lives in an EU country (Poland — YES)
• The amount is proportional to the relative's income (Lebensstandard table per country)

Required: relative's declaration, bank statements showing transfers, birth/relationship certificate.

Step by step — with ELSTER (free)

1. Create an ELSTER account at elster.de (government software)
2. You will receive an Activation ID + Activation Code by mail (10 days)
3. Activate the account, download the .pfx certificate (keep it!)
4. Fill out ESt 1 A — main tax return form
5. Add attachments: Anlage N (employee), Anlage Kind (child), Anlage Vorsorgeaufwand (insurance), etc.
6. Submit electronically
7. You will receive Steuerbescheid (decision) in 2-12 weeks

Step by step — with WISO Steuer (paid but easier)

1. Buy WISO Steuer (~30 €/year) — the most popular application in Germany
2. The application guides you through all questions step by step
3. Automatically imports data from Lohnsteuerbescheinigung
4. Shows estimated refund in real-time
5. Sends to Finanzamt with one click
6. Alternatives: Steuerbot, Smartsteuer, Tax-fix

Step by step — with Lohnsteuerhilfeverein

• Tax assistance organizations for employees (Vereinte Lohnsteuerhilfe, VLH, etc.)
• Annual fee: 100-380 € (depends on income)
• They do the entire settlement for you, but only for employees (not self-employed)
• Common in Polish branches — support in Polish

Average refunds 2026

For a typical employee annually:

• Single without children: ~800-1,200 €
• Single with home office and commuting: ~1,500-2,500 €
• Couple with children: ~1,500-3,000 €
• With support for family in Poland: an additional 1,000-3,000 €

Most common mistakes

• Not filing at all — missing out on an average of 1,100 € per year
• Lack of documentation for family support (Unterhaltszahlungen without bank transfers — rejected)
• Not declaring Polish income — Germany has an information exchange with Poland
• Omitting home office days (210 days × 6 € = 1,260 € automatically)
• Filing without Lohnsteuerbescheinigung (employer provides in January-February)
• Waiting until the last moment (the ELSTER system is often slow in July)