The amount of your tax refund depends on various individual factors, so each tax result is unique. Understanding the factors behind your tax result can help clarify the reasons behind your refund amount, especially if it differs from previous years. Here are some general tips and explanations to help you better understand your result.
What factors influence my tax refund?
Several factors can affect your tax outcome:
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Income replacement benefits such as sickness benefits, parental leave allowance, unemployment benefits (type I), or short-time work compensation can lower your refund or even lead to additional payments.
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Low work-related expenses: If you have few income-related costs, such as commuting or training, your deduction for work expenses (Werbungskosten) might be lower, which can reduce your refund.
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High annual income: A high income can also lead to a smaller refund. This includes not only your salary but also severance payments, bonuses, additional income sources, or employer subsidies, all of which increase your taxable income.
- Tax class combination: Certain tax class combinations, such as class III and V or class VI, may also lead to additional payments.
Not all expenses directly impact your tax outcome because there are specific allowances, limits, or thresholds that apply. For example, general work-related expense allowances or extraordinary expenses have thresholds that, if not exceeded, do not increase your refund, even if additional expenses are reported.
Which expenses can lead to a higher refund?
A higher tax refund may result from:
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High income-related expenses (Werbungskosten): If you had significant job-related expenses, such as commuting costs or professional training, these can increase your refund.
- Starting or stopping work during the year: A job change or a break from work can affect your taxable income, potentially leading to a higher refund.
Which taxes can be refunded?
Only taxes paid during the year can be refunded. The more income tax, solidarity surcharge, or church tax you paid last year, the higher your potential refund. These amounts are found on your income tax statement in lines 4 through 7, and in certain cases, lines 11 through 14.
Estimated income tax payments or capital gains tax paid can also increase your refund.
Which items on the income tax certificate cannot be refunded?
Certain contributions cannot be refunded because they are not taxes:
Insurance contributions such as those for retirement, health, nursing care, and unemployment insurance, are not considered taxes and thus cannot be refunded. Employee social security contributions are not refundable as they go directly to social security funds for public benefit.
Contributions to company pensions are also not refundable as they are specifically designated for retirement and are not tax payments.
Tax-free allowances and bonuses such as Sunday, holiday, or night shift bonuses, cannot be refunded since they are not taxed.
Do I get full amounts of allowances back?
No, allowances are not direct refund amounts. Instead, they reduce your taxable income and thus your tax burden. This may lead to a refund, but it doesn’t mean you receive the exact amount as a cash payment.
For example, a €500 home office allowance does not result in a €500 refund; it simply lowers your taxable income.
What should you do next?
Now that you understand what influences your tax result, carefully check the calculation and entries in your tax return. Here’s how to find your tax return details in your Taxfix account: Where can I check my tax calculation?
If your tax assessment has already arrived and you've reviewed your tax return, take a close look at the notice itself. If there are discrepancies or missing details, you have one month to file an appeal with the tax office.
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