If you are located in a country other than Germany, a tax deduction may have to be made from your earnings. We are currently obliged to withhold a tax deduction on 60% of your remuneration from the base margin. This is comprised of 15% (withholding tax) plus 5.5% solidarity surcharge on the withholding tax. If you are located in a country that has a double taxation agreement with Germany, you may be able to avoid or reduce the deduction.
Do I need to pay withholding tax?
To find out how much the tax deduction is for you, choose the situation that applies to you below. This overview shows whether the country in which you are located has concluded a double taxation agreement with Germany.
Click on the situation relevant to you:
- 1. Country of residence or headquarters in Germany
- 2. Residence in a country with a double taxation agreement with Germany
- 3. Residence in a country without a double taxation agreement with Germany
1. Country of residence or headquarters in Germany
A tax deduction is not made. You don’t need to provide a Tax Identification Number. As long as your name and your address information are correct, you’ll be paid your remuneration in full. However, if your name and address are not correct, we will be unable to pay you. Check your address details here.
2. Residence in a country with a double taxation agreement with Germany
Name and address
The correct specification of your name and address data is a mandatory requirement in order to receive a payout. Check your address details here.
Tax deduction
We have to deduct tax on 60% of your remuneration from the base margin (15% withholding tax plus 5.5% solidarity surcharge on the withholding tax). Spreadshop will register the withheld tax with Germany’s Federal Tax Office and pay it to them.
Spreadshop will provide you with a tax certificate for the tax deduction made upon request. If you present this tax certificate, it may be possible for the withheld tax to be considered as part of your personal tax assessment.
Sample calculation:
Tax deduction on 60% of your remuneration resulting from the base margin for Shop Owners (resident) in Belgium
100.00 EUR earnings from the base margin
-€15 (15% withholding tax)
-€0.82 (5.5% solidarity supplement on withholding tax)
= 84.18 EUR total payout of earnings from the base margin
In this example, Spreadshop is required to declare and pay €15.82 in tax to Germany’s Federal Central Tax Office.
Control reporting procedure (abolished since 2022)
Until the end of 2021, it was possible to have the remuneration from the base margin paid out in full via the so-called control reporting procedure (KMV). However, the KMV was repealed by law on 01.01.2022. As a result, Spreadshop's authorization to continue to apply the KMV from the Germany’s Federal Central Tax Office will expire from 2022. Therefore, when your credit is paid out in January 2022, the KMV will no longer apply. From 2022, tax relief will only be possible by submitting a separate application in the form of an exemption certificate.
Certificate of exemption
You can request a certificate of exemption (Freistellungsbescheinigung) from Germany’s Federal Central Tax Office (BZSt). As of 1 January 2023, this application must be made electronically via the Federal Central Tax Office online portal (BOP).
To log into the BOP, you need a relevant certificate. Two certificates can be used:
- the ElsterOnline portal certificate or
- the BZStOnline portal certificate.
If you haven’t yet registered in one of the two portals, this step-by-step guide is available to help with initial signup.
Once you have successfully logged into the online portal (BOP), you can begin your application under “Forms & Services”. It’s important that you select “Applications according to § 50c EStG” under “Tax International”. This PDF can help you complete the application.
Once you’ve submitted your application for exemption and it has been successfully processed by the Federal Central Tax Office, you’ll receive a corresponding notice in your BOP account. Please send us this certificate of exemption via email.
Once a valid certification of exemption is in place, no tax deduction will be made from that point onwards. For some states, a residual tax rate must be taken into account in this context. Your earnings would then be taxed at a reduced rate. The applicable tax rate is determined by the double taxation agreement that your country of residence has with Germany.
The following applies in all cases:
We would like to point out that the German revenue authorities may inform the local tax office of your place of residence about your earnings.
3. Residence in a country without a double taxation agreement with Germany
Name and address
The correct specification of your name and address data is a mandatory requirement in order to receive a payout. Check your address details here.
Tax deduction
We have to deduct tax on 60% of your remuneration from the base margin (15% withholding tax plus 5.5% solidarity surcharge on the withholding tax). Spreadshop will register the withheld tax with Germany’s Federal Tax Office and pay it to them.
Spreadshop will provide you with a tax certificate for the tax deduction made upon request. If you present this tax certificate, it may be possible for the withheld tax to be considered as part of your personal tax assessment.
Sample calculation:
Tax deduction on 60% of your remuneration resulting from the base margin for Shop Owners (resident) in Paraguay
100.00 EUR earnings from the base margin
-€15 (15% withholding tax)
-€0.82 (5.5% solidarity supplement on withholding tax)
= 84.18 EUR total payout of earnings from the base margin
In this example, Spreadshop is obliged to register and transfer tax in the amount of €15.82 to the Federal Central Tax Office of Germany.
The following applies in all cases:
We would like to point out that the German revenue authorities may inform the local tax office of your place of residence about your earnings.
Please note: The information provided on this page should not be regarded as official tax advice or used to support tax items. Please contact your accountant for tax advice.