Simplified Tax Declaration – Who Can Use It?

The standard tax return includes all options for itemized deductions and tax credits. Taxpayers can use all means to recover contributions made – making the process complicated and time-consuming. For persons to whom most categories do not apply, there is, under certain circumstances, the option to submit a simplified tax return.

Who can file a simplified tax return?

The shortened tax return applies to both employees and pensioners and individuals receiving replacement income.

The following conditions must be met to submit a simplified tax return:

• Income was derived solely from one source – whether wages, pension, or unemployment benefits, insolvency benefits, maternity, parental, or other tax-free benefits.
• Only expenses related to income are deducted – travel expenses, contributions to professional associations, work equipment, application costs, continuing education costs, account management fees, and travel costs for field service activities.
• Special expenses are limited to church tax and donations – without contributions to pension and retirement insurance.
• Extraordinary burdens only include disability pensions, travel expenses due to disability, and spa treatment costs.

The two-page form set for the simplified tax return was applicable until 2018. Since then, the tax office automatically takes into account all basic information, so only the simple title page (Est1A) needs to be filled out.

Unlike in previous years, there are no restrictions with the new simplified forms. Since 2019, the simplified tax return must be used not only for professional expenses.

Even with a simplified return: Have documents ready

Even with a simplified tax return, you should have the most important documents ready. A complete overview of which documents are needed for the tax return helps you with preparation. Even though the simplified form is less comprehensive, additional evidence can increase your tax refund.

Timely submission avoids problems

Whether you submit a simplified or complete tax return – adhere to the legal deadlines. In case of late submission, the tax office sends reminder letters that must be taken seriously. Penalty interest and fines can quickly become expensive

Why was the form for the simplified tax return withdrawn?

The tax office now has easier access to some of the tax data, which no longer needs to be recorded in the tax return. Since the modified forms are easier to fill out, it saves time, and a separate simplified return is no longer needed.

Certain mandatory information is necessary for the tax return – including filling out the simplified tax return. Required are personal data (name, address, date of birth, religion, occupation), marital status, bank details, tax or identification number, as well as information about received replacement income.

Additional forms are necessary for child allowance, various deductions, and extraordinary burdens.

Simplified tax return for pensioners online

Since 2019, the German tax office has offered a free online service for pensioners to simplify the tax return. The advancing digitization has prompted tax authorities to adapt their system for older people who are not fully familiar with the internet.

In addition, the tax authority offers an electronic service for pension recipients in the form of ‘Simple ELSTER’. All information normally recorded manually in the ‘Declaration to Determine Pension Amount’ form can now be completed online.

Only persons with income from pensions benefit from the simplified tax return form in the ELSTER system. For additional income, such as rental income, a standard return is required. There is no obligation for electronic processing – the traditional paper form can still be personally submitted to the tax office.

On the basic two-page form, various deductions can be claimed, but the tax office automatically considers all data on pension or retirement income as well as the amount of contributions paid to health and nursing insurance, so no entries are necessary in this area.

Simplified income tax return with Taxando – even faster!

The tax return can be challenging for people who are not familiar with the current regulations. The quickest and most convenient way to handle all the formalities is to use the Taxando app. With a few clicks and simple steps, you can reach a settlement with the tax office.

Download the program today and try it for free – then purchase the PREMIUM version for many useful options. If you prepare your tax return with a certified tax consultant, a correct procedure is ensured.