My German Exit Tax: 13 Tax Advisors, 1.5 Years, 18.7k€ to leave the country

4ndrewl•19 minutes ago

"I wanted to move to Thailand to live with my girlfriend. I own a few companies" seems like tiny violin territory...

cc62cf4a4f20•about 2 hours ago

These types of taxes are common and logic is simple, you have capital gains that accrued during the time you were tax resident in Germany. By rights the taxes on those gains are due to the German state. So you need to do a deemed disposition and pay the relevant taxes.

I had to do the same when moving country and it’s right.

mamonster•about 2 hours ago

>Other costs (total: 2.6k€): Notary: Changing company address and CEO: 1.5k€ Notary: Changing company suffix from UG to GmbH: 1.1k€

This is absolutely crazy. For comparison, below are the costs in Switzerland (and you can do all the things yourself by writing a letter signed by the authorized persons, so add whatever your time costs):

https://www.fedlex.admin.ch/eli/cc/2020/180/de

leonidasrup•about 2 hours ago

The important sentence in the article is:

" I own a few companies which means I'd be hit by the German exit tax. "

We don't know how many companies does he own.

We can look into exit tax rate, in different countries:

Germany: effective tax rate of up to roughly 28.5%

Japan: CGT rate is 20.315%

Israel: Standard CGT rate is 25%

Austria: Standard CGT rate is 27.5%

https://en.wikipedia.org/wiki/Exit_tax

leonidasrup•about 1 hour ago

It's very good you mention Switzerland, as the contemporary German exit tax legislation traces back to the scandal with Helmut Horten, a department-store magnate who moved to Switzerland in 1968, sold his business stake and paid virtually no tax. The event prompted enactment of the Foreign Tax Act (Außensteuergesetz) in 1972, whose exit-tax provision (§ 6 AStG) is nicknamed lex Horten.

toomuchtodo•17 minutes ago

Very reasonable.

US Exit Tax for comparison:

https://www.irs.gov/individuals/international-taxpayers/expa...

https://americansoverseas.org/en/knowledge-centre/exit-tax-u...

slwvx•about 1 hour ago

Seems like the guy is wondering why they can't avoid taxes more easily. I'm not sympathetic

pu_pe•about 2 hours ago

> The German exit tax is very.. expensive. In simplified terms, I'd have to simulate a sale of all my companies at a high valuation (13.75 * earnings), and pay 30% tax on that.

This is an outrageous valuation and taxation scheme.

I think German politicians either don't understand the magnitude of the issue, or they have been coopted by lobbying somehow. It's such a tough environment for innovation.

Arnt•about 1 hour ago

What do you think is a reasonable price/earnings ratio?

pu_pe•12 minutes ago

It depends on the industry, but regular companies are usually valued at 3x to 6x EBITDA for private acquisitions. A small one-person company would probably be valued at much less than that. Most countries with an exit tax would calculate both the valuation and the tax rate much more favorably than Germany here.

My German Exit Tax: 13 Tax Advisors, 1.5 Years, 18.7k€ to leave the country

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