In light of the upcoming tax return season this autumn, it is helpful to familiarize yourself with essential information regarding this matter. Doing so can help you avoid errors and establish a solid foundation for a successful tax return.
Who Needs to File Tax Returns?
First and foremost, there is a difference between mandatory and voluntary tax returns. Whether you are required to submit a tax return depends on various factors. For instance self-employed individuals, farmers, and business owners are obligated to file a tax return.
Generally, for employees, there is no obligation to file a tax return. However, the voluntary submission of your tax return should always be considered, as you might otherwise be missing out on potential refunds.
A mandatory assessment implies that the taxpayer is legally required to submit an income tax return. Such a situation arises when:
- During the calendar year, an individual received wages from multiple employers simultaneously, resulting in the application of income tax class VI. This also includes income that is subject to income tax, such as rental income or pensions, exceeding €410 after wage tax deduction. The same applies to capital gains on which no withholding tax was paid.
- Special tax allowances for wage tax deduction were requested from the tax office in the previous year (e.g., exceptional burdens or deductions). In the following year, this leads to an obligation to file a tax return.
- In the case of married couples, when one spouse was subject to income tax class V or VI.
- The taxpayer resides abroad but has applied for unrestricted tax liability in Germany.
What Is the Tax Identification Number?
The tax identification number is an eleven-digit nationally standardized identification number assigned to every individual residing in Germany for tax purposes.
Which Submission Deadlines To Keep In Mind
Different deadlines apply, depending on whether you are required to file a tax return or are doing so voluntarily.
Mandatory Tax Return Filing
For mandatory filings, the general deadline is July 31st of the following year. However, these deadlines have been extended due to the ongoing impact of the COVID-19 pandemic. For the 2022 tax year, the deadline is extended to October 2, 2023.
Voluntary Tax Return Filing
In this case, the so-called assessment period applies. This means that the tax return must be submitted no later than four years after the end of the tax year. For the 2022 tax year, the deadline would be December 31, 2026.
Can Deadlines Be Extended?
In principle, yes, if there is a valid reason for an extension. The decision rests with the tax office. If you realize that you cannot meet the deadline, you should promptly request an extension from the tax office with an adequate justification. Such requests are often approved.
Payroll Process Explained
Payroll accounting, as a part of HR management, is a fundamental component of employee management and requires monthly effort for HR managers. The level of effort required largely depends on the software used and whether clear processes have been established. In any case, one thing is clear: payroll accounting should ideally be error-free.
Consequences of Late Submission
Failure to submit a tax return on time allows the tax office to impose sanctions. These may include late submission penalties, which are monetary fines. Moreover, an additional coercive fine can also be added. More details about these penalties and deadlines can be found here.
Therefore, remember to file your tax return on time or, if necessary, request an extension. We wish you good luck and a successful tax return!