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From what I've learned from locals, filling tax declaration in Germany is fully optional, until you have your company. Most people are doing this, because they get a tax return. But the only consequence of not doing this is not receiving tax return.

However, what about the situations where you are an expat (arriving within tax year) or an ex-expat (leaving within tax year) and in given year you have an income in 2 (or more) EU countries? Does filling a tax declaration remains still optional?

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In Germany, your employer must make sure to pay enough income tax to the tax office that it is guaranteed you are not underpaying. That may be at a very high tax rate, because for example your US income would be taken into account to find out what tax rate you would have to pay. Say you were unemployed in the USA for six months and make €50,000 in Germany, they calculate the taxrate for €50,000 and apply it to your German income. If you made €100,000 in the USA, the calculate the much higher taxrate for €150,000 income and apply that rate to your €50,000 income. Since your employer doesn't know your foreign income, he'll have to pay tax at a high rate to make sure you pay enough.

So yes, filling out your tax declaration is optional, but it's stupid not to do it. It's a German national sport, you lose if you don't compete in it.

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