If the taxable income in 2020 is a maximum of EUR 17,000 for a single person and no more than EUR 34,000 for spouses filing jointly, In any case, the cheaper test saves taxes. You can find out how to do it here.
What is the discount test?
If you receive interest or dividend payments, the bank automatically withholds the withholding tax of 25%. Added to this is the solidarity surcharge of 5.5% and, for church members, the church tax. This means that it is not mandatory to fill out the KAP appendix for the tax return. However, it may be financially worthwhile for you to fill out the form if your marginal tax rate is below the withholding tax. You can see the amounts for 2020 in the info box.
by the way: If your marginal tax rate is not below the withholding tax, there is no risk for you if you fill out the KAP annex anyway. The tax office will then determine the cheaper option for you.
Rule of thumb for the cheaper test: If the taxable income in 2020 is a maximum of EUR 17,000 for a single person and no more than EUR 34,000 for spouses filing jointly, the more favorable test is worthwhile. Because below these amounts is the personal marginal tax rate less than 25 percent and is therefore cheaper than the flat-rate withholding tax.
Why filling out the KAP annex can also be worthwhile
In the following other cases, it may also be worth submitting the KAP annex:
- You forgot to give your bank an exemption order. The bank then pays withholding tax, although the first 801 euros (singles) or 1,602 euros (married couples) are tax-free. You can have overpaid tax refunded via the KAP system
- If you were already 64 years old at the beginning of the 2018 tax year, you can also claim an old-age tax credit of 1,900 euros. Married couples receive 3,800 euros. The bank does not automatically take this amount into account.
Appendix KAP: If so then yes
If you decide to fill out the KAP appendix, complete proof of all capital gains received must be submitted to the tax office. The bank will usually automatically send you a corresponding overview at the beginning of a new year. Everything is already clearly compiled here and you can simply transfer the amounts to your tax return.
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