How does double taxation affect my pension if I live abroad?
April 14, 2022 | 110,00 EUR | answered by Isabel Zimmermann
Dear tax advisor,
My name is Jenny Eiserfelder and I have been living abroad for some time now. I receive my pension from Germany and I have heard that there may be a possibility of double taxation. This information concerns me greatly, so I am reaching out to you for clarification.
Currently, I am receiving my pension from Germany and paying taxes on it here. Since I now live abroad, I am wondering if I will also have to pay taxes on my pension there and how this will affect my financial situation. I am concerned that double taxation could result in a significant portion of my pension being lost, and I am worried about my financial future.
So my question to you is: How will double taxation affect my pension if I am living abroad? Are there any ways to avoid or at least minimize this? I would like to know what steps I can take to optimize my tax burden and prevent any potential losses.
Thank you in advance for your support and advice. I look forward to hearing back from you and hope that you can help me with this issue.
Sincerely,
Jenny Eiserfelder
Dear Mrs. Eiserfelder,
Thank you for your inquiry regarding double taxation in relation to your pension from Germany while living abroad. It is understandable that this information can be concerning, as no one likes to pay unnecessary taxes. I will now explain in detail how double taxation can affect your pension and what steps you can take to prevent potential losses.
Double taxation occurs when a taxpayer is required to pay taxes on the same income in two different countries. In your case, you receive a pension from Germany and live abroad, which means that both Germany and the country where you reside may tax your pension. This can result in a significant portion of your pension being lost to taxes.
To avoid or at least minimize double taxation, there are various options you can consider. Firstly, it is important to familiarize yourself with the double taxation agreement between Germany and the country where you reside. These agreements determine which country has the right to tax certain incomes and how double taxation can be avoided.
Furthermore, you may consider filing tax returns in both Germany and your country of residence to ensure that you disclose all relevant tax information. In some cases, you may also apply for tax reliefs or exemptions to reduce your tax burden.
It is advisable to seek advice from an experienced tax advisor on this complex issue to analyze your individual situation and identify the best measures to optimize your tax burden. A professional tax advisor can help secure your financial future and prevent potential losses from double taxation.
I hope this information has been helpful to you and I am available to answer any further questions you may have.
Kind regards,
Isabel Zimmermann
Tax Advisor
