Can losses from capital investments be claimed for tax purposes?
July 7, 2023 | 40,00 EUR | answered by Anna Karpinski
Dear tax advisor,
My name is Otto Peters and I have been active as an investor in the capital market for several years. Unfortunately, I have recently experienced some losses in my capital investments. Now I am wondering if these losses can be claimed for tax purposes.
My current capital investments mainly consist of stocks and investment funds. Unfortunately, some of my investments have not performed as expected and I have incurred losses. These losses amount to a considerable sum and I am worried that I may have to report high losses at the end of the year, which could negatively impact my tax return.
Therefore, I would like to know if and to what extent losses from capital investments can be claimed for tax purposes. Are there specific requirements that need to be met in order for these losses to be deductible for tax purposes? Are there perhaps also ways to offset losses from previous years against gains from this year?
I would greatly appreciate your help and advice on this matter, as I would like to minimize my tax burden and optimize my financial situation. Thank you in advance for your support.
Sincerely,
Otto Peters
Dear Mr. Peters,
Thank you for your inquiry regarding the tax treatment of losses from capital investments. I am sorry to hear that you have experienced losses in your investments recently. I am happy to help you clarify your tax situation and explore potential ways to optimize it.
In general, losses from capital investments can be claimed for tax purposes. These losses can be offset against positive income from capital assets to reduce the tax burden. It is important to note that losses from capital investments can only be offset against gains from capital investments. If your losses exceed your gains, you can carry forward the remaining loss for future years.
There are certain requirements that must be met in order for losses from capital investments to be tax deductible. Firstly, you must be able to prove the losses, for example through relevant statements or receipts. Additionally, the capital investments from which the losses arose must be subject to the flat-rate tax. This typically applies to stocks and investment funds, as you mentioned.
To offset losses from previous years against gains from this year, you can use the loss carryforward. This means that losses incurred in one year can be offset against gains in subsequent years. This can help reduce your tax burden.
I recommend that you consult with a tax advisor to analyze your individual tax situation and take appropriate measures. A professional tax advisor can help you claim your losses in a tax-efficient manner and optimize your financial situation.
I hope this information is helpful to you. If you have any further questions, please feel free to contact me. Thank you for your trust and best wishes for your financial situation.
Kind regards,
Anna Karpinski
