Do I have to declare ETF gains myself in my tax return?
In Germany, usually not: if your brokerage account is with a German bank, it withholds the Abgeltungsteuer (German flat capital-gains tax) automatically — your ETF gains are then settled. You only have to (or should) declare them yourself in certain cases: a foreign brokerage account, an unused allowance, loss offsetting across several banks, or a lower personal tax rate.
The short answer
With a German broker/account, the bank withholds the Abgeltungsteuer (German flat tax of 25 % + solidarity surcharge + church tax where applicable) automatically and pays it to the tax office. Your ETF gains are thereby settled in principle — you do not need to enter them in your tax return. An obligation or an advantage only arises in special cases (see below).
When you have to do NOTHING
The standard case: a German account + a submitted exemption order (Freistellungsauftrag). The bank then withholds no tax on up to €1,000 of income per year (Sparerpauschbetrag) and the Abgeltungsteuer automatically above that. You need no line in your tax return for this — the matter is “settled” (abgegolten).
When you MUST or SHOULD declare
- Foreign brokerage account (mandatory): A foreign broker does not withhold German Abgeltungsteuer. You must declare and tax the income yourself via the German Anlage KAP form.
- Allowance not used up: If you submitted no exemption order or one that was too low, you reclaim the excess tax paid through your tax return.
- Loss offsetting across several banks: Gains at bank A, losses at bank B? They can only be offset against each other through your tax return (with a loss certificate, Verlustbescheinigung).
- Favourability check (Günstigerprüfung): If your personal tax rate is below 25 %, the Anlage KAP can lead to a refund.
- Forgotten church tax / non-assessment certificate (NV-Bescheinigung): Corrections also run through the tax return.
Which forms?
The relevant German tax-return schedules
| Form | What for |
|---|---|
| Anlage KAP | Capital income in general, favourability check, foreign accounts |
| Anlage KAP-INV | Investment income from foreign funds/ETFs without German withholding tax (KESt) |
| Verlustbescheinigung (loss certificate) | Request from the bank by 15 Dec to offset losses across banks |
Even without a sale, the Vorabpauschale (advance lump-sum tax) can be due each year on accumulating ETFs. At German brokers it is collected automatically from the settlement account — make sure there is enough balance there. With a foreign account you must declare it yourself via the German Anlage KAP-INV.
FAQ — ETF gains in the tax return
Do I have to declare ETF gains with a German broker?
In principle no. The German bank withholds the Abgeltungsteuer automatically and pays it. Your ETF gains are thereby settled and do not need to go into the tax return — unless you want to use advantages such as loss offsetting or the favourability check.
What about a foreign broker?
Then no one withholds German tax automatically. You are obliged to declare and tax the capital income yourself via the German Anlage KAP (or KAP-INV). This also applies to the Vorabpauschale on accumulating ETFs.
When is the Anlage KAP worth filing voluntarily?
When you have not used up your Sparerpauschbetrag, when you want to offset losses and gains across several banks, or when your personal tax rate is below 25 % (favourability check). In these cases you reclaim excess tax paid.
How do I offset losses across two banks?
You request a loss certificate (Verlustbescheinigung) from the bank with the losses by 15 December and enter both gains and losses in the Anlage KAP. The tax office then offsets them against each other and refunds the excess Abgeltungsteuer paid.
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