INCOME TAX RETURN 2020
Deadline on October 31, 2020
Tax return 2020: filing deadline 2021 extended due to Corona
There are two deadlines for filing the tax return for the 2020 tax year:
If you are subject to tax and prepare your tax return yourself, the submission deadline ends on October 31, 2021. The deadline actually ends on July 31, 2021, but due to the pandemic it has been extended by 3 months. Since October 31, 2021 is a Sunday, the deadline is postponed to Monday, November 1, 2021. In federal states where November 1st, 2021 is a public holiday, November 2nd, 2021 is the last tax return date for 2020.
If you are subject to tax and have your tax return drawn up by a tax advisor or an income tax aid association, the submission deadline ends on May 31, 2022.
Deadline for submission by yourself
31 October 2021
Deadline for submission by a tax advisor
31 May 2022
Why are the deadlines different?
The submission deadline with the assistance of a tax advisor / income tax aid association is significantly longer. The background: On the one hand, as a taxpayer, you should have enough time to look for a suitable tax advisor to prepare your tax return. On the other hand, the tax advisors should be given enough time to prepare their clients' individual tax returns.
What options are there for preparing a tax return?
Apps, software or the simple route to a tax advisor can help with the preparation of your tax return.
Tax apps
Tax apps promise to simplify the creation and submission of tax returns. The special thing here is that no prior knowledge of tax law is required for the apps. You basically do everything yourself under the guidance of the app. The use of such apps is usually free of charge. Costs are only incurred when the tax return is to be submitted to the tax office.
Tax consultant
Tax advisors offer the greatest security. You can see where advertising costs and special deductions are possible and thus minimize the tax burden. In this way, your very individual living conditions can be taken into account. This saves you time and money.
Tax software
With the help of tax software, you can easily do your own tax return and submit it directly online. For people without prior tax knowledge, the forms provided in the software can often be challenging. For the use of such software, you pay a one-time fee per tax year, which can vary depending on the software provider
Apps, software or would you prefer a tax advisor?
Apps and software are a good way of preparing tax returns quickly and easily at home using a computer, tablet or smartphone. But apps and software also reach their limits sooner or later. The less specialist knowledge you have in tax matters and the more complex your tax case is, the more likely it is advisable to go to a tax consultant.
Why it is worth going to a tax advisor?
Especially with extensive tax returns, a tax advisor si the better choice as you will save time and money:
Professional quality: A tax consultant knows the details of tax law and the constantly changing regulations. Thereby it is possibler to exploit the full optimization potential for the clients. With a tax advisor at your side, you can not only save a lot on tax payments, but also gain valuable time that you can use for other tasks and undertakings.
Depth of advice: You will receive detailed advice and it will be explained to you which expenses can be deducted. A tax advisor will point out receipts and deductions that you have not thought of yourself. This is also helpful for the following years as you will be able to identify invoices that you may need to keep for the tax return. A good tax advisor will also advise whether it makes sense to change the tax class. This can save taxes, but above all it can mean that you have more money at your disposal during the year.
Order in chaos: With the help of a tax advisor, you avoid late payment surcharges at the tax office, because he relieves you of the burden of monitoring all tax-related deadlines. Pending and already made payments to the tax office are checked by the consultant, so that you usually do not run the risk of overpaying or being prosecuted for not paying taxes. In addition, a tax advisor will check the tax statements issued by the tax authorities for any flaws or mistakes. How important this is is shown by statistics from the German Federal Ministry of Finance on appeals processing in 2017: more than half - namely 64 percent - of all tax assessments are simply incorrect.
Communication with the authorities: Another advantage worth mentioning is, of course, that all communication with the tax authorities is carried out by the tax advisor / tax consultancy firm. This is a great advantage because German tax law is difficult and notices and statements by authorities are easily misunderstood or may not even be comprehendable for a lay person. Here, a tax consultant will make sure that nothing gets lost in translation.
Liability: Another advantage is the liability of the tax advisor in the event of damage. If you suffer economic damage due to incorrect information in the tax documents, this falls under the liability of the tax advisor. As a result, you are legally protected and at the same time the professional status of tax advisor is raised to a high quality level due to the great responsibility towards you.
What are the costs of a tax advisor?
The fee is based on the German Tax Advisor Remuneration Ordinance. The basis for the specific costs is the object value (here in most cases the amount of income) and the effort necessary for the individual processing of the tax return. Ask beforehand for an estimate of the likely costs in your specific case. A good tax advisor will be able to give you a rough range for the costs.
In the long run, good tax advice will bring you significant cost reductions and tax refunds.
Can I deduct tax advisor fees?
Yes. If you decide to seek advice from a tax advisor and the tax consultancy costs are income-related, then you can deduct the costs in your tax return.
How can I deduct tax advisor fees?
Tax advice costs are deductible as income-related expenses or business expenses if they are in fact work-related.
The tax consultancy costs for the following form can be deductible as business expenses:
- Annex N (non self-employed)
- Annex V (rental)
- Annex R (pensions)
- Annex SO (other income)
- Annex AUS (foreign income)
The tax consultancy costs for the following forms can be deductible as business costs:
- Annex G (commercial enterprise)
- Annex S (self-employed work)
- Annex L (agriculture and forestry)
- Annex EÜR (income-surplus-account)
Of course, there are other, more complex sources of income. A tax advisor will help you in individual cases and determine which costs you can deduct exactly.
The following expenses related to the work (of the tax advisor) are also deductible:
- Determination of expenses and income as well as filling in the corresponding annexes
- Preparation and supervision of the bookkeeping
- Expenditures for specialist tax literature / specialist tax literature
- Travel expenses to the tax advisor
Which tax consultant costs cannot be deducted?
Tax advice costs cannot be deducted if they are incurred to determine tax issues in your private life.
The costs for creating the following forms, among others, are not deductible:
- Completion of the income tax return including cover sheet and annex "children"
- Determination of special expenses and extraordinary burdens
- Consultancy costs on the topics of child benefit, childcare costs, inheritance tax, income tax rates, etc.
What we can do for you:
Preparation of the income tax return 2020
You send us all the documents you have, such as wage slips, invoices and receipts. Then we examine teh details your income and your expenses in a joint discussion. In this way we can individually identify the expenses that you may not have thought of yet.
Convince yourself of our services and save money and time.