How do I apply for the capital gains tax allowance (section 16 (4) EStG)?

If you are over the age of 55 or permanently incapacitated, you can apply for a tax allowance on the capital gain. This is provided it is the first time since 1996 (§ 16 para. 4 EStG).

It may be the case that a portion of the capital gain is only 60% taxable under the partial income procedure. This applies if the business assets sold included shares in corporations. This portion cannot additionally benefit from the tax allowance. Therefore, the portion that is 60% taxable must be deducted from the capital gain and entered in line 16.