Exemption Order for Capital Gains: Who Qualifies and What You Get
Learn how to protect your first €1,000 of annual capital gains from tax by using an exemption order with your banking institution.
This scheme allows you to protect a specific amount of your annual investment income from being taxed by your banking institution.
Who it's for
This is for anyone who holds a German bank account and earns money through interest or dividends.
What you get
You can receive tax-free treatment on your first €1,000 of capital gains each year. This means the bank will not automatically deduct tax from your earnings up to this limit.
What it costs you
It is free to use. To benefit, you simply need to submit the necessary request to your bank.
The catch to know
If you hold accounts at more than one bank, you cannot claim the full €1,000 at every institution. You must manually split the total allowance across your various banks so that the combined total does not exceed the yearly limit.
How to apply
- Contact your bank or log in to your online banking portal.
- Locate the section for tax settings or investment orders.
- Set the amount of your allowance for each account.
- Submit the order to your banking institution.