If a company pays out a dividend, this happens after the profit has already been taxed at company level. If you receive a dividend as a private individual, this must in turn be taxed in Germany as capital income. Taxed be
Tax Treatment of Dividends in Germany
Like gains arising from trading in shares or other financial instruments (price gains), dividends count as Income from capital assets and will be connected to the Settlement tax taxed. This amounts to 25%, plus solidarity surcharge, plus church tax if applicable. The individual income tax rate is irrelevant.
Withholding tax on foreign shares
If you receive dividends from foreign companies, often a Withholding tax which they can reclaim or offset against the final withholding tax, provided there is a double taxation agreement, such as the one between Germany and the USA. In this case, the withholding tax rate of 30%, which applies to domestic investors, can be reduced to 15% for foreign investors. However, you must apply for the reduction in withholding tax in advance. Further information on this can be found at: Advance reduction of withholding tax
Savers' lump sum
As long as the income from capital assets does not exceed the amount of EUR 1,000 per year for individuals or EUR 2,000 for married couples (as of 2023), there is no withholding tax and the income is not subject to withholding tax. tax free.