Tax return 2024: How to secure your refund!

Tax return 2024: How to secure your refund!

In 2020, there were around 25.8 million taxpayers in Germany, of which around 14.9 million filed a tax return. These tax returns resulted in 12.6 million taxpayers receiving a refund, averaging 1,063 euros. How MDR reported that employees who pay their taxes properly generally do not have to pay additional payments unless their tax bracket changes. Filing a tax return is only mandatory in certain cases, including wage replacement benefits over 410 euros, additional income or self-employment.

Wage replacement benefits include, for example, unemployment benefit I, short-time work, sickness, parental or maternity benefits. It should be noted that persons in tax classes III, V or VI are required to submit a tax return. In contrast, single taxpayers in tax class I and married couples in IV/IV have the opportunity to decide annually whether to file a tax return. If the tax office requests submission, a declaration must be submitted.

Advantages of tax returns

A tax return can be particularly worthwhile for taxpayers who have high business expenses, use household-related services or are submitting a return for the first time. The important expenses that are deductible include business expenses, special expenses and extraordinary expenses. To maximize reimbursement, receipts and supporting documents should be retained as these will need to be presented in the event of tax office inquiries. In addition, it should be noted that incorrect bank details can delay the tax refund.

The deadlines for filing the 2024 tax return are clearly regulated: those who submit their tax return themselves have until July 31, 2025, while the deadline for professional help is April 30, 2026. When salaries increase, the opposite of what many expect often happens: net earnings do not decrease because higher wages are taxed disproportionately due to tax progression.

Tax classes and their effects

The choice of tax bracket can have a significant impact on monthly income. Changing tax classes, especially when combining classes III and V, can lead to higher monthly income in the short term. Loud Financial tip The 60-40 rule allows for lower income tax deductions. It should also be noted that the tax brackets have no influence on the final tax burden after the tax return.

Switching to tax class III can be particularly advantageous for couples who receive wage replacement benefits such as parental allowance. The person who takes the majority of parental leave should request this change at least seven months before the start of maternity leave in order to benefit from the higher net pay. However, using tax classes III and V can also lead to additional payments, as part of the wage tax saved often has to be paid back.

In the current discussion about tax classes, it could also make sense to rethink these strategies, especially if tax classes III and V are about to be abolished. Whether one's own income can be optimized by changing or adjusting the tax bracket remains an important consideration for many taxpayers in Germany.