In most cases, those who voluntarily file their tax return can expect a refund, especially when utilizing user-friendly tax software that guides you through each step. These programs offer straightforward explanations, some even available in English, making the tax return process more manageable. Additionally, many tax software applications provide helpful tips on how to maximize your deductions and save on taxes. With these tools at your disposal, the annual tax return can even become an engaging and rewarding experience.
If hiring a tax advisor or joining an income tax help club like “Lohnsteuerhilfeverein” is not within your budget or preference, there are alternative options available. You can consider using one of the following tax programs, which are cost-effective and provide valuable assistance. These programs offer step-by-step guidance for preparing your tax return and can even help you identify potential tax savings. In the following section, we have highlighted our top four recommended tax programs.
What is ELSTER?
ELSTER, which stands for “Elektronische Steuererklärung” (Electronic Tax Return), is a user-friendly online service provided by the government. It enables taxpayers to securely submit their income tax returns, wage tax returns, and sales tax returns directly to the tax office. ELSTER is free of charge and offers a convenient and efficient way to file your taxes online.
To get started with ELSTER, you need to register for an account on the ELSTER portal and complete the necessary verification process. Once your registration is confirmed, you can utilize the ELSTER interface to submit your tax return electronically to your local tax office. The encrypted connection ensures the privacy and security of your data.
After submitting your tax return, the tax authorities will review your information and provide you with your tax assessment. This includes detailed calculations and any relevant comments. ELSTER streamlines the process, making it faster and more convenient for taxpayers to interact with the tax office and receive their tax assessment.
#1.”Wundertax” 2023 – User-friendly English Software
Wundertax is an online tax tool that simplifies the process of preparing your tax return. Through a question-and-answer format, you provide information about your situation, and Wundertax guides you step by step to complete your tax return accurately.
Wundertax offers various platforms tailored to different groups, including employees, self-employed individuals, students, police officers, soldiers, and expatriates. This makes it an excellent choice for expats who are not yet fluent in German, as the program is available in English and provides comprehensive guidance throughout the tax return process.
What expenses can be deducted with Wundertax?
Wundertax allows you to deduct a wide range of expenses, similar to a manual tax return. Some deductible expenses include telephone and internet charges, insurance premiums, volunteer work expenses, moving expenses, travel expenses, education costs, housekeeping expenses, application document costs, union dues, health-related expenses, workplace-related expenses, pension contributions, and renovation costs.
With Wundertax, you can complete your tax return efficiently in approximately 17 minutes, thanks to its straightforward and user-friendly interface.
#2. “WISO Tax“ Savings Book – Your Comprehensive Tax Solution
WISO Tax Savings Book is a highly regarded tax software that ensures you meet your tax obligations while maximizing your refund from the tax office. By using this program, you can save on costly consultations or memberships in income tax help clubs. WISO Steuer-Sparbuch consistently receives accolades in independent tests and garners top ratings in the trade media.
Whether it’s income-related expenses, education costs, managing a two-family household, claiming commuter allowances, or optimizing your Riester pension, WISO Steuersparbuch is equipped to handle all tax-saving opportunities and provide guidance for an optimal refund. The software includes all necessary tax forms and covers various specific circumstances.
Note: This program is highly acclaimed by German taxpayers and is currently considered the best option in the market. However, it is only available in German, making it suitable for individuals who have a basic understanding of the language.
How does the WISO tax software work?
The process begins by describing your personal and family situation, including your place of residence, marital status, and number of children. Next, you enter your income and associated expenses in the following categories:
- Salary and wages
- Pension and annuity
- Alternative benefits, such as unemployment benefits
- Rental income and property leases
- Capital gains from stocks and mutual funds
- Interest and dividends
- Income and expenses from freelance, business, and self-employed activities
Depending on your individual circumstances, WISO Steuersparbuch provides real-time updates on the potential refund you can expect from the tax office and identifies areas where you can maximize your savings. With WISO Steuersparbuch, you can have peace of mind knowing that your entries will be thoroughly reviewed to eliminate any inconsistencies and ensure that you have included all the necessary information. By leveraging the software’s comprehensive checks, you can feel confident that your tax return is accurate and optimized for the best possible outcome.
#3. “Smartsteuer” – Connected with ELSTER
Smartsteuer is the leading online tax return provider in Germany, serving individuals, self-employed individuals, and small businesses. Their focus has always been on simplicity, user-friendly support, innovation, and utmost security. Smartsteuer aims to make the tax filing process as easy as possible for everyone, allowing users to file their returns from the comfort of their own homes. The results speak for themselves, with Smartsteuer users receiving an average refund of 1,069 euros from the government.
The Smartsteuer software is compatible with any PC or tablet, regardless of the operating system. There’s no need for installation—just access to the internet and an up-to-date browser. A practical feature is that payment is only required when you transmit your data to the tax office, allowing you to review your return for free.
Note: One advantage of Smartsteuer is its integration with ELSTER, the government’s free tax return tool, enabling users to directly upload their returns to ELSTER. However, it’s important to note that the Smartsteuer program is only available in German, so a basic understanding of the language is necessary to use the tool effectively.
#4 “Tax 2023” – The price-performance winner
The “Tax 2023” software offers exceptional performance at an affordable price. It covers all types of income, including employees, pensioners, retirees, those receiving wage replacement benefits, rental income, leasing, and capital gains. It is also equipped to handle various forms of income tax returns. Additionally, you can utilize features like wage tax reduction for 2021 or homeownership promotion to maximize your tax benefits.
You have the flexibility to choose between printing out your tax return on paper or submitting it electronically via ELSTER, both of which are officially recognized options. If you opt for ELSTER, you can avoid submitting most of your receipts.
To provide you with an accurate estimate of your tax refund, the software calculates the precise amount. You will receive a sample notice with a detailed explanation, allowing you to compare it with your official tax notice.
Note: This program offers the best price-performance ratio in the German market and has the added advantage of integration with ELSTER, the government’s free tax return tool. This enables you to directly upload your tax returns to ELSTER. However, it’s important to note that the software is available only in German, so a basic understanding of the language is necessary to utilize the tool effectively.
Are Tax Software Costs Deductible in Germany?
Yes, the costs for tax software in Germany are deductible, just like the expenses for tax books or contributions to the Lohnsteuerhilfeverein. These costs cannot be exclusively categorized as business or private, allowing for flexibility in allocating them to different expense categories:
For costs up to 100 euros, you can fully report them as income-related or business expenses. Amounts between 101 and 200 euros can be claimed as a flat rate of 100 euros, without the need for supporting documentation. If the fees exceed 200 euros, you can deduct half of the costs, while the remaining portion is disregarded. Once again, no proof of payment is required for this allocation.
Strategic Timing: Maximizing Benefits with Tax Programs in Germany
In Germany, the deadline for filing income tax returns is July 31 each year. As this deadline approaches, tax software often becomes more affordable. However, it’s important to note that the longer you wait, the less time you have to prepare your tax return.
Tax software is typically released at the beginning of December, coinciding with seasonal bargains. Alternatively, you can opt for downloading the software, eliminating shipping costs while receiving the software license via email. Another cost-effective option is purchasing the “Frustfrei-Pakete,” which includes the software on DVD without additional books and comes in simplified packaging. These editions are usually more affordable than packages that include supplementary materials and glossy boxes.