(2022) When is it necessary to complete Form KAP?

With the introduction of the withholding tax, it is generally no longer necessary to submit the KAP form. However, in some cases, submission is still required:

• the capital gains are not subject to tax deduction (e.g. sale of GmbH shares of less than 1 percent)
• income from foreign accumulating investment funds
• income (interest, dividends, etc.) from foreign accounts or deposits
• interest from loan agreements between private individuals
• interest on tax refunds
• sale of endowment life insurance policies (if taken out after 2005)

The KAP form must also be completed if one of the following points applies in the case of an optional assessment:

• a loss carryforward from previous years is to be taken into account or a loss offset of income from capital assets is to be made,
• the saver’s allowance has not been fully utilised,
• church tax was not deducted despite church tax liability,
• foreign taxes are still to be considered,
• the amount of the capital gains tax deduction is to be checked.

You must also fill in the KAP form if you wish to apply for a so-called favourable tax rate check. This may allow you to benefit from a lower tax rate if your individual tax rate is lower than the withholding tax rate of 25 percent.

Note: For certain income, you must also complete the KAP-INV form (for income from investment earnings not subject to domestic tax deduction) or KAP-BET form (for income from capital assets in the case of shareholdings, if the income and the tax to be credited have been determined separately and uniformly).

 

Losses from worthless shares in the case of pure account write-offs may be offset against income from capital assets, but there is a limit. Losses can only be offset against income from capital assets up to a maximum of 20,000 Euro. Unused losses are then carried forward to subsequent years. Important: In the case of worthless shares, the bank does not carry out a loss offset. It does not enter losses into the loss pot. Losses from worthless shares must therefore be included in the tax return.