Emigration + pension + tax office
If you emigrate from Germany, you no longer pay taxes here – or do you? A lawyer who emigrated to Portugal to enjoy his pension tax-free found that the German tax office still wanted taxes. The reason: Portugal attracted pensioners with 0% tax for a while, but the tax office in Germany followed suit and demanded that taxes be paid in Germany if Portugal did not levy any.
What had happened?
Our pensioner had two pensions – one from the lawyers’ pension fund (similar to the statutory pension) and a private pension insurance policy. Although Portugal had promised not to levy taxes on pensions for 10 years, the German tax office made additional claims. The reason: there must be no double non-taxation – taxes have to be paid somewhere.
The court ruling
The case went before the Rhineland-Palatinate Fiscal Court. The ruling in the first instance: the man had to pay tax on his private pension in Germany. Statutory pensions would have been tax-free in Portugal, but private pensions are not covered by this regulation. However, the court allowed an appeal and now the Federal Fiscal Court will decide on the matter in the test case.
What does this mean for pensioners?
Anyone who has private pension insurance and emigrates should be vigilant. It is worth lodging an appeal against tax assessments and referring to the ongoing test case. This will keep the case open until the Federal Fiscal Court makes a final decision.
If you are in a similar situation, you will find PepperPapers.de the appropriate sample objection. You can use it to defend yourself against your tax assessment and the tax on your pension abroad.
