Lucrative: this is why you should file your tax return retroactively

Those who file their tax returns retroactively can probably expect a windfall

For some the tax return is coming up again soon. Others do the stress only every few years. To give them retroactively, may well be worth it.

Not every German is required year after year to file tax returns. Especially employees can do this on a voluntary basis – those who have a lot of paperwork lying around at home will be happy to take advantage of it.

File your tax return retroactively: Here’s how it works

Everyone else can sit back and relax- and the file a tax return retroactively. After all, you already pay a monthly income tax. Which conditions you have to fulfill and which deadlines you should better pay attention to, the editorial team explains to you.

For the 2019 tax year, the assessment period ends on 31. December 2023, like t-online.en (as of: 17.2.2021) reported. Also still possible to submit tax returns for 2018 (due to a conveniently located weekend until 2. January 2023) and 2017 (until 31. December 2021).

Submit tax return retroactively to four years

In principle, a tax return is useful to get an overview of whether you have paid too much or too little tax during the year and/or whether you have taken advantage of any tax allowances. Who does not do this namely, on which in the consequence for example juicy tax arrears can threaten. However, there are Groups of people who are required to file a tax return each year until the corresponding deadline of the following year. This includes:

  • Self-employed
  • Persons with secondary income from small businesses
  • People who have several jobs at the same time
  • Married couples in tax class IV with factor or with a combination of tax classes V and VI

If you are not obligated however to it, experts even tend to advise filing a tax return retroactively. The reason: Often you can expect that you have paid too much and get money back. After all, you already pay taxes during the year according to your income tax bracket.

File a tax return retroactively: Refund interest from the IRS

In addition, you could send them Refund interest are entitled to, such as reports. This means that the tax office pays interest on the repayment amount. According to the United Lohnsteuerhilfe, one must get the final tax assessment for this at least 15 months after the respective tax year, writes the portal- for the 2019 income tax return thus on 1. April 2021. The tax repayment would then be interest-bearing by the state with 0.5 percent per month. However, the report states, refund interest is considered taxable investment income.

Read in addition: Claim home office per diem – Here’s how it works with your tax return

In 2009, the Federal Fiscal Court decided by law to raise the deadline for retroactive tax returns from two to four years. This usually means: This means that you can remain in the tax bracket for up to 31. December retroactively make a tax return for past four years. But: It must be submitted to the tax office by this date. However, since a lot can accumulate in four years, tax experts often recommend in these cases to go to the Lohnsteuerhilfeverein or tax advisor.

Basically, it is recommended – in order to facilitate the work of the income tax help or the consultant – to sort and file all receipts and documents that accumulate over the year neatly in folders or the like. But what to do if you have missed the deadline after four years? Then you have missed it willy-nilly – an extension of the deadline is no longer possible at this point.

Why you even benefit from a retroactive tax return

In contrast, if you file a retroactive tax return, you rarely have to expect to be pay money in arrears should. If this should be however the case, recommend tax experts to withdraw its submitted tax return. For this you merely file by letter an objection within four weeks after receipt of your tax assessment at the tax office. This means that the tax return is considered not to have been filed- and you do not need to pay in arrears.

However, students also benefit from waiting until the four-year deadline. Finally, these often do not have to file a tax return during their studies. If you then file it retroactively, you can, for example after the study expenditures for a second study fully set off. You can have these costs deducted as income-related expenses as soon as you draw your first salary in your job. These are then usually offset against the taxes on the first salaries – and you pay so in the first year of employment less income tax.

But beware: However, this regulation does not apply to the first degree (for example, Bachelor of Arts). The tax office recognizes any study costs here only as special expenses and not as income-related expenses. Therefore, a loss carry forward is not possible.

Students can even file a loss carry forward retroactively for up to seven years

Good to know: In some cases, you can Submit tax return retroactively even up to seven years. You can do that if you want to claim what is called a loss carry forward. This is particularly profitable for trainees and students. Although the tax authorities are said to have considered several times to recognize only the four-year period, until now students& Co. nor of a Loss determination retroactively for seven years use. In this you claim your study costs (losses) in a tax return to the tax office. That is, in the end you get money back in the form of a tax refund.

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