Limited and unlimited tax liability

The decisive factor for determining income tax in Germany is whether you have limited or unlimited tax liability with regard to German taxes. Since you do not live in Germany, you are generally always subject to limited tax liability. In order to be treated as a person living in Germany and thus be subject to unlimited tax liability, you must fulfil certain conditions:

  • 90% of your world income is taxed in Germany, or
  • Your non-German income in this calendar year is below € 9,744 (as of 2021/2022: € 9,984)

If you are married, you and your spouse must both meet these conditions. The income that is not taxable in Germany must then not exceed €19,488 (2021) – €19,968 (2022) in this calendar year.

In the case of unlimited tax liability, personal and family-related tax benefits, including the basic tax-free allowance, can be granted as if you were resident in Germany.

You must submit an application each year to the tax office responsible for your employer in order to be treated as a limited or unlimited taxpayer. The application forms for limited and unlimited tax liability can be downloaded from the download area.

The chapter Tax Classes contains further information on the consequences of limited and unlimited tax liability.