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Old 07.06.2013, 23:51
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Income in Germany

Hi all,

I have a question regarding income tax. My wife's parents want to give her a small piece of agricultural land in Germany, from which we would then receive a rental (pacht) income. We are resident in Switzerland and all our other income is earned and taxed in canton Zurich.

I understand from our Swiss tax advisor that the extra income will not be taxed in Switzerland, but must be declared to establish our point on the progression curve for income (and wealth) taxes. There should be no tax on the transfer levied by Zurich or by the confederation.

What's not clear to me though is how things work on the German side. This is my understanding from googling:

1) We would not be liable for any income tax at all since we would have a German income below the start of their progression curve (around 8k euros)
2) There is no wealth tax
3) The gift would not be taxed because it falls below the threshold for parent to child gifts (400k euros)
4) There is a land tax which would be paid directly by the tenant irrespective of the total size of our asset base

Can anyone confirm or deny what I have uncovered there? Point one looks particularly dodgy to me. I wonder if they wouldn't hit us with income tax at a point in the progression curve that reflects the extent of our total worldwide income, as is done here in Switzerland.

Thank a lot in advance for any pointers!
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Old 08.06.2013, 00:46
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Re: Income in Germany

Try asking our cousin in Germany. http://www.toytowngermany.com/

You should give more info: amount of income, and town /State
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double taxation, germany, income tax, land, wealth tax

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