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Comment by rkachowski | Hacker News Reader

> Pretty much every other major developed country operates like this

cries in German

Most employees don't need to even submit a tax return as with PAYG your taxes are already collected by your employer.

If you do end up filing your taxes, you can access the prefilled tax statements. Software to do that is free and easy. If you want software advising you on how to get a bigger refund, you'll have to pay maybe $10-20, though the $5 software from Aldi works fine for me.

As an employee doing your taxes is optional in Germany as taxes are already deducted by the employer.

It can work ok if you're a single person with no children. However, you'll potentially have to pay a lot more tax if you're married where your spouse earns more or less than you. There several other reasons where legally you'll have to complete a tax return (e.g foreign income).

German taxes are really horrible, in general. They expect you to pay in advance for expected untaxed income (based on the previous year's return). Working out the taxes on the income from some ETF is a nightmare, unless your platform does it for you. Unless you really understand the system and can file your own taxes, then low-wage freelance work just doesn't make sense as the cost of doing the taxes can be higher than your income. This means people are trapped into not working.

The fun part about advances is that in the first year they don't have data to set your advances so you have to back pay the taxes for the first year in full after filing the first year's taxes in the second year in addition to now having to pay the advances on that year so even if you saved all the money you expected to have to pay in taxes during the first year you also need to have saved up enough to pay the advances but the more money you made (allowing you to set more money aside), the higher the advances will be.

You can negotiate to have your advances reduced but the government really doesn't like it when businesses (including freelancers and solo entrepreneurs) have a high difference between their advances and the actual taxes. This also goes for declaring your VAT (which depending on how much you make you'll have to do monthly or quarterly as an advance and then alongside your income tax) and while in that case you basically set the advance yourself you'll get in trouble if it doesn't match your actual VAT (difference between charged and paid).

You can file your own taxes and if you're a regular employee there are tons of non-commercial orgs you can go to that will assist you in doing that but if you're a "business" (even if it's just you and you haven't incorporated) they'll often not help you.

BTW the reason you can just forego filing your own taxes as an employee if you just want to be taxed on your wages (and don't have anything else to declare, e.g. interest on savings) is that your employer already had to do the taxes on your wages and benefits for you. So it's not like the government just does them themselves, it's just done by payroll instead of you.

This was semi-true until this year (if you didn't care about the often massive deductions you would have just for living somewhere other than your office desk, and only for as long as the tax office would not demand you to file taxes, which they could do for any reason, and often).

Now, with the 300 Euros of fuel relief, every employee will have to file taxes on said 300 Euros.

https://www.elster.de/elsterweb/infoseite/belegabruf_(privat...

Of course, why would you trust a piece of software created by your government to fill out the forms in a way that benefits yourself instead of them?

This thread was not about deductions, but about the government pre-filling your tax-returns with data it already has about you. Parent was implying that does not exist in Germany, which isn't true. Or are you actually saying that the government will deliberately fill in wrong values, so that you have to pay higher taxes, even though the prefilled values are visible to you and discrepancies would be obvious (and a huge scandal).

There are several ways in which a software can fill data "wrongly".

If you are legally able to claim deductions, pre-filled tax forms that do not contain those deductions are by definition wrong, even though you may agree with individual form items. While this can be related to innocent mistakes and the sheer inability of the state to know the necessary information, sometimes it appears to be deliberate: The classic example is the Pendlerpauschale, which does not appear in Elster pre-filled tax forms even though the state does have all necessary information (address of your flat / address of your employer) to fill it.

If you accept these faulty forms, you will almost always pay more taxes than you have to.

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