How a German tax resident reports foreign rent and a sale: Anlage V and Anlage AUS, exemption with progression, credit of foreign tax, the ten-year period and deadlines.
A person who is resident in Germany is generally taxed on income from all over the world. If you own an apartment abroad and rent it out, or if you sell it, this normally has to be considered in your German income tax return (Einkommensteuererklärung), even if you also pay tax in the country where the property is. What you enter and where depends on the double tax treaty (DBA) between Germany and that country. This article describes the usual structure; the details of your treaty decide your case.
Which form: Anlage V, Anlage AUS or neither
Germany has two basic situations for foreign income.
- Treaty exemption. If the DBA gives the right to tax rent from immovable property to the country where it is located, Germany normally exempts the income but keeps the right to use it to set the tax rate for your other income (Progressionsvorbehalt, section 32b of the income tax act, EStG). This is reported on the Anlage AUS, the schedule for foreign income and foreign taxes. The income is determined under German rules, so keep the German-style calculation of income and expenses.
- Credit. If the treaty uses the credit method, or if there is no treaty, the income is taxed in Germany and the foreign tax is credited under section 34c EStG, as a rule up to the German tax that falls on that income. The rent usually goes to the Anlage V (rental income) and the credit to the Anlage AUS. Without a treaty, section 34c also lets you deduct the foreign tax from income instead of crediting it.
Which situation applies depends on the treaty. One source we checked says the treaties with Spain and Switzerland use credit for rent, but we could not confirm it from the treaties themselves. Check the immovable property article and the method article of the treaty with your country, using the Federal Ministry of Finance list (bundesfinanzministerium.de). Statute texts: section 34c EStG and section 32b EStG.
Rental income abroad
Under exemption with progression, the foreign rent does not increase your base income, but it raises the tax rate on your other income. Practically, the effect depends on your other income. Some advisers report that losses from exempt foreign rental cannot be offset against German income; ask whether that applies to you.
Keep the lease, the foreign tax return or assessment, proof of payment, and a statement of expenses. Convert foreign currency into euro according to the German rules, which your adviser or the tax form guidance will specify.
For the general logic of treaties see our overview of double tax treaties.
How foreign tax is credited or exempted
Under credit, the foreign tax must correspond to German income tax, and the credit is capped at the German tax on that income. The foreign tax that exceeds the cap is generally lost for credit purposes. Under exemption, no credit is claimed, because the income is simply left out of the German base. In either case, the Finanzamt may ask for proof that the foreign tax was actually paid.
A reminder for readers who come from Russian-speaking communities: the German treaty status letter for 2026, as summarised by tax advisers, mentions the suspension of the treaties with Russia and Belarus. If your property is in a state with a suspended treaty, do not assume that the exemption applies. Check the official page and ask an adviser.
Selling within ten years
For private individuals, section 23 EStG (text) treats the sale of real estate as taxable if the time between purchase and sale is not more than ten years. The profit is reported on the Anlage SO. There is an exemption for property that you used exclusively for your own residential purposes from purchase to sale, or in the year of the sale and the two preceding years.
Whether a gain on a foreign property is taxed in Germany at all depends on the treaty: many treaties give the right to tax gains on immovable property to the country where it is located. We did not verify the position for any particular country, and whether such a gain is excluded from the German base but counted for progression should be asked of your adviser.
Reporting and deadlines
Apart from the tax return, there are reporting rules to check. Section 138 of the tax code (AO) requires notifications of some foreign business relationships; whether private rental property abroad falls under it is a question for an adviser, as we could not settle it. Payments across the border may be reportable to the Bundesbank under the foreign trade rules: reports state that the threshold is EUR 50,000 per payment, and that natural persons are not covered by the report of foreign assets. These points should be verified before a purchase.
For tax year 2025, the return was due on 31 July 2026 if you prepared it yourself and on 1 March 2027 when prepared by a tax adviser, according to several portals. Late filing can lead to a late-filing surcharge. For later years, check the current deadline at elster.de or with your adviser.
FAQ
Do I have to declare foreign rent in Germany if it is exempt by treaty? Usually yes, because exempt income can still affect the rate (Progressionsvorbehalt) and is reported on the Anlage AUS. Ask your adviser about any exceptions.
Can I credit foreign tax and also claim exemption? No. For the same income either exemption (without credit) or credit applies, depending on the treaty.
How long must I wait to sell without German speculation tax? The general period for real estate is ten years from purchase, subject to the own-use exemption and to the treaty position for foreign property.
Do I need a certified translation of foreign documents? The Finanzamt may ask for translations. Ask early so that you can get them in time.
What if there is no treaty with the country? Then the income is generally taxed in Germany and foreign tax is credited or deducted under section 34c EStG, with limits.
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We are a trilingual platform that finds properties and coordinates independent local lawyers and tax advisers, including advisers for the tax return in your country of residence. This text is informational and is not legal, tax or investment advice; rules and deadlines change, so verify the current position with your Finanzamt or adviser. Our country pages and calculators can help you plan.