Don`t trust ChatGPT! Traders in Germany pay 26,5% on their trading income (even less, if their total annual income from any source is less than about 20k) with out any upper restriction! It could be millions. No limit, but no deductions of expenses, trading education, computers .....as well. And no fiscal authorities can change that, as that is the one and only taxation rule for private persons. But as soon as you incorporate your activities trading within the liabilities limiting GmbH or AG, a different tax code applies. The corporation will have to pay corporate and trade tax,but you will be able to deduct your salary as well as your Porsche. But when you take money out of the firm, personal income tax plus ... will apply. The corporate setup will cost you no less than 1500€ p.m., every month, even if you don`t trade. Kind regards
Traders heaven? Until few weeks ago for the last 3 years Germany had the most stupid tax code special regulation to stop trading: deductable losses were capped at 20k p.a. And combinations like spreads were calculated separately. 3 simple butterflies per year - no more! So all option traders had to trade their positions NAKED! Yes the mentioned tax rate is correct but for traders the public health insurance will charge you another 18% of your income, flats are rare, housing expensive ...... lowest??
I don't know...housing in Germany seems high quality at reasonable rent prices. In any case, I'd be happy to not get taxed 50% and live in a developed country with reasonable living costs. What alternatives are there? It seems that many countries have implemented insane tax policies for active trading. For example, in Ireland, losses made on a stock trade can only be deducted against profits from the same stock. Meaning that if you trade multiple stocks during a year, you are taxed on your winnings - not on your net profit. Say your total profitable trades amount to 300k per year, and your total losses are 200k. Think you made a 100k profit? The tax office orders you to pay ~150k (50% of profitable trades), so you end up -50k for the year. I really hope they don't actually implement it like this. This is based on reading through the tax guidelines on the gov website, perhaps I've misunderstood it (anyone from Ireland can confirm?)
That would be insane. Chat.GBT: "After reviewing the available information, I found no evidence to suggest that Irish lawmakers have proposed changes to capital gains tax regulations that would restrict the offsetting of losses to profits from the same stock. Under current Irish tax law, capital losses can be offset against any chargeable gains in the same tax year, and any excess losses can be carried forward to offset future gains. While there have been discussions about various tax reforms in Ireland, such as adjustments to retirement relief for family businesses and considerations of wealth taxation, none of these proposals pertain to altering the treatment of capital losses in the manner described. Therefore, the scenario where losses must be matched to gains from the same stock does not align with current regulations or any known proposed changes in Ireland."
Ok Chatgpt, read from the Irish gov website https://www.revenue.ie/en/gains-gif...-an-asset/selling-or-disposing-of-shares.aspx Specifically, the following part: Seems insane.
Let's take a closer look at the information from the Irish Revenue website you provided. According to the page, the general rule under Irish capital gains tax law is that capital losses can typically be offset against capital gains arising in the same tax year. If total allowable losses exceed gains, the excess losses can usually be carried forward to offset future gains. However, there is a specific provision regarding losses on the disposal of shares. The Revenue states that: If you sell shares at a loss, that loss can usually be set against any other capital gains in the same tax year. But if you sell shares to a connected party (e.g., a relative or a business you control), the loss can generally only be offset against gains made from disposals to the same connected party. This exception could be the basis of the misunderstanding or confusion around whether losses must be offset against profits from the same stock. However, in typical transactions (not involving connected parties), losses on shares can be offset against any capital gains, not just gains from the same stock. To clarify the previous statement: Current regulations allow capital losses to offset any chargeable gains within the tax year, except in specific connected party transactions. As of now, there is no general rule requiring losses to be matched with gains from the same stock, except in specific circumstances outlined by the Revenue.
It's right there in the example they provided and I quoted. The specific circumstance is short-term trades, less than 4 weeks holding period. This should be of interest to all traders (though I have to assume Ireland has none because of this rule).
[.. I don't know...housing in Germany seems high quality at reasonable rent prices. In any case, I'd be happy to not get taxed 50% and live in a developed country with reasonable living costs. .. [/QUOTE] If you call rents starting above 12€ p.m. net (plus 4€ add. costs plus heating plus services) - all this per square meter---reasonable - okay, yet the availability of ANY housing is the present problem.
16 euros per square meter is about 1.6 usd per sq ft. you can’t get a decent place for that in the US even in my bumble fuck town. Forget a proper city like New York, Chicago, Miami or San Fran.
16 € is about the official starting rent averaged all over Germany including its many underdeveloped areas in rural East Germany - double this up for the top cities (which are far from proper compared to N.Y., Chicago, Miami...). Still the rate won`t guarantee any availability, as housing is more than rare. Therefore many successful German traders flock to Cyprus. Less tax, less health insurance, less rent, less regulations and less rain!