Can double taxation be avoided?
April 17, 2024 | 120,00 EUR | answered by Guido Hoffmann
Dear Sir or Madam,
My name is Jens Zellmer and I have a question regarding double taxation. I work as a freelancer and have income in both Germany and another country where I regularly carry out assignments. I have noticed that my income is being taxed in both Germany and abroad, leading to double taxation.
I am concerned that due to this double taxation, I may lose a significant portion of my income and I wonder if there are ways to avoid this. Are there any tax regulations or agreements between Germany and the respective country that can prevent double taxation? What steps can I take as a freelancer to minimize my tax burden and ensure that my income is only taxed once?
I would greatly appreciate it if you could provide me with possible solutions to avoid double taxation and optimize my tax situation. Thank you in advance for your help and support.
Sincerely,
Jens Zellmer
Dear Mr. Zellmer,
Thank you for your inquiry regarding double taxation. As a freelancer with income in both Germany and another country, you are indeed affected by the issue of double taxation. It is understandable that you are concerned and looking for ways to avoid this and optimize your tax situation.
There are various instruments and regulations aimed at avoiding double taxation. One of the most important instruments in this regard are the so-called Double Taxation Agreements (DTAs) between Germany and other countries. These agreements determine which country has the right to tax the income and thus prevent double taxation. Usually, the right to tax is awarded to the country where the taxpayer is resident. However, there may be other criteria that determine which country has the right to tax.
As a freelancer, you should first find out if there is a double taxation agreement between Germany and the country where you operate. If so, you should check if and how this agreement is applicable to your specific situation. In many cases, the DTA can help you avoid being taxed on your income in both Germany and abroad.
Additionally, you should explore other tax possibilities to minimize your tax burden. It may be beneficial to seek advice from an experienced tax advisor who can provide you with individual solutions. There may be tax planning options that can help you optimize the taxation of your income.
In any case, I recommend that you thoroughly inform yourself and seek professional advice to optimize your tax situation and avoid double taxation. I hope this information is helpful to you and I am available to assist if you have any further questions.
Best regards,
Guido Hoffmann
