How are dividends taxed in Germany?

Dividends from shares are capital income taxed at a flat 25 percent Abgeltungsteuer, withheld at source by your bank. The Solidaritätszuschlag of 5.5 percent of that tax and, if applicable, church tax of 8 or 9 percent of the tax are added, giving an effective rate of about 26.4 to 27.99 percent.

What is the Sparer-Pauschbetrag for dividends?

It is the saver's allowance, 1,000 EUR per person or 2,000 EUR for jointly assessed couples since 2023. Dividends, interest, and capital gains within this allowance are tax-free if you have lodged a Freistellungsauftrag with your bank so it does not withhold on the first 1,000 EUR.

What is a Freistellungsauftrag?

It is an exemption order you give your bank telling it not to withhold tax on capital income up to your Sparer-Pauschbetrag. You can split the allowance across several banks, but the total cannot exceed 1,000 EUR (single) or 2,000 EUR (couple).

Does the Solidaritätszuschlag apply to dividends?

Yes. Although the Soli was abolished for most ordinary income, it remains in full force on Abgeltungsteuer, including dividends. It is 5.5 percent of the dividend tax amount, not of the dividend itself.

Is foreign withholding tax handled here?

No. Dividends from foreign companies often suffer foreign withholding that can be partly credited against German tax under a double-tax treaty. This calculator assumes German-sourced dividends without foreign credit; for foreign shares consult your Steuerberater.

Germany Dividend Tax Calculator

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Germany taxes share dividends as capital income at a flat rate rather than at your personal income-tax band. This calculator applies the Abgeltungsteuer, the Solidaritätszuschlag, and optional church tax after your saver’s allowance to show exactly what lands in your pocket.

How it works

The first slice of dividends is shielded by the Sparer-Pauschbetrag. The remainder is taxed at the flat 25 percent, with the Soli and any church tax calculated on the tax itself:

taxable = max(0, gross dividends − Sparer-Pauschbetrag)
base tax = taxable × 25%
soli     = base tax × 5.5%
church   = base tax × (8% or 9%)   [optional]
net dividend = gross − base tax − soli − church

Because the Soli and church tax are charged on the tax, not the dividend, the effective rate on the taxable slice is about 26.375 percent without church tax and up to 27.99 percent with it.

Example

A single investor receives 5,000 EUR of gross dividends with church tax of 9 percent. After the 1,000 EUR allowance, 4,000 EUR is taxable. The base tax is 1,000 EUR, the Soli adds 55 EUR, and church tax adds 90 EUR, leaving 3,855 EUR net.

Notes

This assumes German-sourced dividends and a filed Freistellungsauftrag. It does not handle foreign withholding credits or the Günstigerprüfung for low earners. Everything runs locally in your browser.