What is an exemption?

In general, members who have their tax residence abroad must pay tax on their income in Germany as well as abroad. In the case of royalty payouts, we are obliged to deduct 15% income tax as well as 5.5% solidarity tax from the income tax amount. Since there are double taxation agreements between Germany and many other countries, you, as our member, are entitled to file an application for exemption with the Federal Central Tax Office, provided your tax residence is in such a country. (You will receive the link to the application form together with our cover letter). The exemption is granted there. Upon receipt of this, pay-outs can be made without any tax deduction.

When it comes to exemptions for the US, Form 6166 needs to be submitted for the current tax year in addition to the exemption application. You as a member need to apply for and pay for them. Applications for the exemption are sent to you also with our covering letter.

Please note that the Application for a Tax Exemption Certificate can only be submitted electronically through the Online Portal BOP provided by the BZSt. You can find information about the Online Portal BOP and the application here: BZSt - electronic data submission.