Income tax is imposed on individuals, company tax is imposed on legal entities, trade tax is imposed on any industrial establishment in Germany: Thus, all legal entities are subject to both trade tax and company tax, whereas individuals are subject to both taxes only if their income derives from such industrial establishment. However, the trade tax is deductible from the income subject to income tax and to company tax, thus reducing the overall tax burden.

It is noteworthy that no other partnership, association or other is liable to income or company tax, as such: Instead, the income of such entities is directly attributed to its partners / associates and constitutes a part of their taxable income.

Both the trade tax act and the company tax act refer to the income tax code as to the determination of the taxable income. Hence, I will first outline the basic principles of the German income tax act before turning to the trade tax and the company tax.

Income Tax:

• Income Tax
• Capital gains tax
• Paye Tax
• Church Tax
• Solidary surcharge
• Table of Income Tax