What is a tax break

Tax advantages: Legal & helpful tips for saving taxes in 2021!

The word tax advantages often sounds a bit disreputable to many, but it doesn't have to be the case. There are many ways and a few smart tips to save taxes - and quite legally. The best way to do this is to have a good tax advisor explain to you, and you will find him here with us.

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Some of the biggest tax benefits include getting married, having children, and renting out the condominium. Here we explain how you can reap tax advantages and tips on what you can deduct on your next tax return in order to save.

Table of Contents:

Tax advantage wedding
Tax benefits child
Tax benefits condominium

Tax advantage wedding

Spouse splitting

That some marry for purely tax reasons has long ceased to be a cliché, but for many an acceptable and good reason to enter into the state of marriage. And for those who marry for love, the wedding tax advantage cannot be crossed off the tray. Unfortunately, singles have to queue up when it comes to tax benefits.

But how much tax can you save by getting married? One of the greatest tax benefits of marriage is what is known as spouse splitting. Your income tax can be assessed together and you are treated like a taxable person.

This is especially worthwhile if one partner earns a lot and the other earns very little. A taxable income is assumed to which the so-called splitting table is applied. This spitting advantage may help you save a lot of taxes. The best thing to do is to marry shortly before December 31st, then the splitting advantage applies, namely retrospectively for the whole year!

Tax brackets

There are different tax brackets and if you get married, the combination IV / IV automatically applies. This combination works for couples who earn roughly the same amount.

If one of the partners earns a little more, then the factor method with the tax class choice IV / IV is worthwhile. In order to avoid higher taxation of the better-earning partner, there is a splitting advantage, which is already offset against the current year.

The third option is the tax class combination III / V. The partner who earns less then also has to pay less income tax and this combination is particularly suitable if one partner earns significantly more than the other.

In general, you can easily change the tax class with your partner (the sum of the tax classes must always add up to 8), even once a year. This can be worthwhile if a spouse's salary changes, for example. The application for this must be submitted to the tax office by November 30th.

To find the right tax bracket combination that will give you the most tax benefits, you should talk to your tax advisor. They can also advise you when you should change the income tax bracket and whether it is worth filing a joint income tax return for you and your partner.

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Other tax benefits of marriage are a double saver lump sum and very much higher tax-free donations to your spouse. Another factor that you don't want to think about when getting married, but which is not insignificant later, is a higher one Allowanceif you inherit from your partner. As a spouse, you can inherit up to € 500,000 tax-free and also live tax-free in the same house.

Even when it comes to Insurance you can save a lot together. For example, you can jointly take out statutory health family insurance as well as liability and legal protection insurance.

Tax benefits child

Per child is available to you monthly Child benefit from the state to. From 2021 this will be € 219 per month for the first and second child, € 225 for the third child and even € 250 for additional children (as of January 11, 20121). In order to receive this child benefit and other associated tax advantages, you must, however, submit a child benefit application to your responsible family benefits office. Child benefit is not only available for biological children, but also for adopted and foster children.

The state will always give you child benefit or a Child allowance ensures what you get is decided in your favor. This allowance is made up of an education allowance as well as a neuter child allowance, which are calculated for each parent. These also double if you are married and assessed together.

If you are a single parent, you are entitled to the full tax exemption if your partner has died or cannot be found. In order to ensure the greatest possible allowance for you and your child, it is best to contact a tax advisor who will advise you.

Your tax advisor can also help you get benefits thanks to your child with your tax return. To do this, you must also fill out the child annex to the tax return, one annex for each child. With it you can post like School fees and write off care costs from the tax.

Under certain circumstances, this can add up to a lot, because you can deduct up to € 4,000 per child up to the age of 14. This includes costs for the childminder, the daycare center or even the au pair. Even those who send their children to school abroad or to a private school in Germany can save. Up to a maximum of € 5,000 of the school fee (30%) can be deducted from the tax.Notdeductible are costs for music or tutoring as well as school books.

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Tax benefits condominium

The condominium can also bring you tax advantages. However, a distinction must first be made between whether the apartment is being used or rented out.

Deducting craftsmen from the tax: Those who use the apartment themselves are only allowed to Handicraftsthat have been done in the apartment. Only 20% of this, a maximum of € 1,200 tax per year. The expenses must be declared on the cover sheet of your income tax returns. Material costs cannot be deducted and the wage costs must be clearly documented - cash payments are not accepted. Also make sure that material costs are strictly separated from wage costs on the invoice, because only services are accepted by the tax office.

Commercial expenses from renting: Those who rent their condominium have more tax advantages. In return, as a landlord, you of course also have to pay tax on your rent or lease income. As a landlord you can then write off a lot as advertising expenses. This includes all expenses to initially rent out the apartment, but also insurance costs that arise later. You can also deduct renovations or maintenance as well as costs to the property management (e.g. janitorial costs, garbage disposal fees) or interest on the loan for the apartment.

Tax income from renting and leasing - what can be deducted?

Household services:So-called household services can also bring tax advantages, including things like cleaning or gardening, as long as they take place in the apartment, in the house or on the associated property.

In some cases, you can also deduct the depreciation of your home for tax purposes or part of the property tax and legal protection. A tax advisor is best able to explain what works and what doesn't.

Tip: You can also save taxes in homeowners' associations when there is work such as maintenance or for the caretaker in the residential complex. Even if the contract for this mostly comes from the community of owners, you can write off your share if you were involved in the costs.

There are also many other legal ways to secure tax advantages for you. Both in the family and in the company. Some of these seem small at first, but can quickly add up and lead to greater savings.

How to deduct donations from tax

The best way to find out which tax advantages are for you is to have an expert tax advisor explain to you. You can find it with us. Send us an inquiry and briefly describe your tax issues to us. We put together up to 3 offers from tax consultants in your area, which you can then compare in terms of expertise and costs. You are guaranteed to find a consultant who suits you! Our service is of course free and non-binding for you.

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