N26 tax reporting

Tax and legal
1

Hi Community!

I’m new here but have a few questions I hope some of you can answer.

If/when opening an N26 account online, how and when are taxes calculated - if so? Is this something one has to do oneself/declare like in other situations or is that done automatically by how much funds are present on a given account?

Say, if one lives in another of the European countries / other than Germany or Austria.

And is there a certain limit of funds where this is done or not?

Thanks in advance!

Blessed day to you all!

2 Likes
2

Hi @dba_79, what taxes are you talking about? Income taxes?

Other than taxes on interest or dividends (which you don’t get with an N26 account), there’s no income that banks usually have anything to do with in terms of tax reporting.

If you talk about other income (e.g. salary or business income), you have to manually report and pay tax on that where you live.

N26 will still report the balances of your account every year to the German authorities, which then forwards it to the country where you’re tax resident (like all banks in countries that are part of the AEOI/CRS scheme)—but they don’t report the turnover of the account. This kind of reporting is done no matter if you have €0 or €1,000,000 in your account at the end of the year.

1 Like
3

All right, thanks Thomas

When you’re talking about balances and turnovers, the difference lies in?..

The way I understand what you’re writing is that no matter how much or little you have going in and out of your account during the year, its your (one’s) own responsibility to report that to the given tax offices.

The only thing that will be automatically reported is the actual account balance on the last day of the year, just like in other normal bank procedures.

Have I understood this correctly?

Thanks again

Johan

2 Likes
4

Yes, you got that right. :slight_smile:

By turnover I mean the amount of money that pass through the account during the year—this is not automatically reported. As you say, only the balance on the final day of the year is reported (along with your current address information and a few other bits and pieces).

1 Like
5

I understand. Thank you, Thomas :slight_smile:

/Johan

6

HOWEVER, it must be noted that the bank (any bank) still has the duty to report transactions that appear suspicious, e.g. too large, too frequent etc.: https://www.bafin.de/EN/Aufsicht/Geldwaeschepraevention/Verdachtsmeldewesen/Verdachtsmeldewesen_node_en.html

1 Like
7

That’s a very good point @enzomich :slight_smile:

That usually has to do more with combating potential money laundering than it has to do with tax enforcement. At least that’s what they say :wink:

8

Sounds reasonable.

But what is meant by “too large” or “too many”?

Money can be both own inpayments/savings as well as friends transfers or sale of private items, furniture, music instruments, just to name a few.

9

So pretty much you’re saying if you’re getting a hefty amount every so of the month (say 10K every first of the month) , there’s a risk it’ll be reported and investigated… and you’re fucked (if it its not declared)