Flat-rate withholding tax · Question 5 of 12
Who usually pays the flat-rate withholding tax to the tax office for a German securities account?
1 answer is correct. Easy
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Answer
- B The custodian bank
Explanation
German banks withhold the investment income tax when income is credited or when securities are sold, and pass it on to the tax office. The tax is thus usually settled in full, hence the name "Abgeltungsteuer". With foreign securities accounts, investors must declare the income themselves in their tax return.