Everything expats need to know about taxes in Germany: Steuer-ID, Tax Number, and VAT Registration

Can't read the whole guide? Here's what you need to know right now:
Your Tax ID (Steuer-ID) is an 11-digit number like "12 345 678 901" that you need to work and settle in Germany. You get it automatically and free when you register your address, arriving by mail within 2-6 weeks. If you need it urgently, visit your local Finanzamt with your passport and get it same-day.
You only need one number if you're an employee. If you're self-employed, you'll also need a Tax Number (Steuernummer) for invoicing. If you run a business with EU clients, you might need a VAT Number too, but most expats don't.
Yes, you can work without it temporarily—your employer will just deduct taxes at the highest rate and you'll get a refund later. No, there's no deadline for getting it, but delay means paying more taxes upfront. No, it doesn't cost anything.
The most common mistake? Confusing your Tax ID with your Tax Number and giving your employer the wrong number. The second most common mistake? Not putting your name on your mailbox, so the letter gets returned as undeliverable.
Read time: 12 minutes
What you'll need: Your passport and proof of address
Based on the uploaded documents and my research, I'll now create your comprehensive guide following your specifications.
Germany has multiple tax identification numbers, each serving different purposes. Getting confused is completely normal. One expat shared: "I thought my Tax ID and tax number were the same thing. I spent weeks wondering why my Finanzamt kept asking for a number I thought I'd already given them."
This guide will walk you through everything you need to know about German tax identification and registration. You'll understand which numbers you actually need, how to get them, and what to do if things go wrong. More importantly, you'll learn how to navigate the German tax system without the headaches most expats experience.
Why does this matter? Without proper tax registration, you can't get paid correctly, open certain bank accounts, or access benefits like Kindergeld. Your tax status affects nearly every aspect of settling into German life.
Germany uses different tax identification numbers for different purposes. Think of them as keys that unlock different parts of the German bureaucratic system.
There are three main types:
1. Tax ID (Steuer-ID) - Your personal, permanent identification number 2. Tax Number (Steuernummer) - For freelancers and business owners
3. VAT Number (Umsatzsteuer-ID) - For businesses conducting EU transactions
The confusion happens because these numbers look similar and people use the terms interchangeably. But they're distinctly different, and understanding which one you need will save you countless frustrating phone calls with the Finanzamt.
Regular employees: Only need the Tax ID
Freelancers and self-employed: Need both Tax ID and Tax Number
Business owners selling to EU customers: May also need a VAT Number
Students working part-time: Only need Tax ID
Your Tax ID (Steueridentifikationsnummer) is your permanent personal tax identification number in Germany. It's an 11-digit number formatted as "12 345 678 901" that stays with you for life, even if you move cities, change jobs, or get married.
This number was introduced in 2007 to modernize Germany's tax system. Before that, Germans received new tax numbers every time their circumstances changed, creating administrative chaos.
Your Tax ID is mandatory for virtually everything involving money in Germany:
The Federal Central Tax Office (Bundeszentralamt für Steuern) automatically issues your Tax ID, not your local tax office.
Babies born in Germany automatically receive their Tax ID a few days after birth. Don't be surprised when official mail arrives addressed to your newborn. Your children need their Tax ID for daycare registration and to receive Kindergeld on their behalf.
The Steuernummer is a 10-11 digit number in the format "12/345/67890" assigned by your local tax office (Finanzamt). Unlike the Tax ID, this number is not permanent and can change if you move to a different tax office jurisdiction or register a new business.
You only need a Steuernummer if you:
Regular employees do NOT need a Steuernummer. If you're just working for an employer, your Tax ID is sufficient.
You receive your Steuernummer when you register your business by submitting the "Fragebogen zur steuerlichen Erfassung" (Tax Registration Questionnaire) to your local Finanzamt. It arrives by mail 2-8 weeks later.
The VAT number (Umsatzsteuer-Identifikationsnummer or USt-ID) is a 9-digit number with the format "DE123456789" used to identify businesses in EU transactions. The "DE" prefix indicates Germany.
You only need a VAT number if you:
You do NOT need it if you:
You can have a VAT number even if you don't charge VAT on your invoices. Conversely, you might charge VAT within Germany using only your tax number, without needing a VAT number.
Request it when registering your business via the tax questionnaire, or apply later through the Federal Central Tax Office website. It's issued separately from your tax number.
Timeline: 2-6 weeks
Difficulty: Easy
Success Rate: 70-80%
Step 1: Complete Your Anmeldung
When you register your address at the Bürgeramt for the first time in Germany, this automatically triggers your Tax ID issuance. Make sure the registration officer has your correct information, especially your full name as it appears on your passport.
Step 2: Wait for the Letter
The Bundeszentralamt für Steuern will send you a letter containing your Tax ID to your registered address. This typically takes 2-6 weeks, though it can take up to 8 weeks during busy periods.
Step 3: Ensure Your Name Is on Your Mailbox
This is crucial. Many expats never receive their Tax ID letter because their name wasn't on the mailbox and the letter was returned as undeliverable. Write your name clearly on your mailbox immediately after moving in.
Step 4: Store It Safely
When your letter arrives, keep it in a safe place. Take a photo and store it digitally as backup. You'll need this number regularly.
The letter is an official document from the Bundeszentralamt für Steuern. It's in German, with your Tax ID clearly printed near the top. The heading will say "Mitteilung der Steueridentifikationsnummer."
Timeline: 4-8 weeks
Difficulty: Medium
Use When: You never received your automatic letter
Option A: Online Request
Visit the Bundeszentralamt für Steuern website and fill out the online form requesting your Tax ID. You'll need to provide:
The Tax ID will be mailed to your registered address only. For security reasons, they cannot email it or send it to alternative addresses.
Option B: In-Person Visit
Go to your local Finanzamt with your passport and proof of address (Meldebescheinigung). Ask for your Tax ID at the information desk. Many offices can print it immediately, though some will still send it by mail. No appointment is typically needed for this quick inquiry.
Option C: Check Existing Documents
Before requesting, check if you already have it on:
This is frustratingly common. Here's what to do:
Can't find your Tax ID but need to start work? You can work without it temporarily. Inform your employer that your Tax ID is pending. They'll place you in tax class 6, which means higher tax deductions from your salary (around 50% instead of your actual rate). But you'll get this money back when you file your tax return once you have your Tax ID.
If you need your Tax ID urgently for a job starting immediately, visit your Finanzamt first thing in the morning with your passport. Explain the urgency. Many offices will help on the spot.
No. As an employee, your tax registration happens automatically through three processes:
1. Getting Your Tax ID (automatic when you register your address)
2. Your Employer's Registration (they register you with the tax office)
3. Your Tax Class Assignment (automatic based on your status)
Germany assigns you to one of six tax classes (Steuerklassen) based on your marital status:
Tax Class 1: Single, divorced, or separated
Tax Class 2: Single parents raising children alone
Tax Class 3: Married, earning significantly more than spouse
Tax Class 4: Married, both spouses earning similar amounts
Tax Class 5: Married, earning significantly less than spouse
Tax Class 6: Second job or working without Tax ID
Your tax class determines how much income tax is withheld from your monthly salary. Importantly, your tax class doesn't change your total annual tax burden, it only affects monthly deductions versus year-end settlement.
Yes, if you're married. Couples can choose between:
Changing tax classes is done through your Finanzamt using form "Antrag auf Steuerklassenwechsel bei Ehegatten."
You're fully registered when:
Unlike employees, self-employed individuals and freelancers must actively register with the tax office. This process is more complex and involves multiple steps.
Freelancer (Freiberufler): Doctors, lawyers, journalists, consultants, designers, programmers, translators, and other "catalog professions" listed in German tax law. Freelancers have simpler registration and don't pay trade tax.
Business Owner (Gewerbetreibender): Everyone else, including online sellers, restaurant owners, retail shops, and manufacturing. Requires Gewerbe registration.
Not sure which you are? A tax advisor can help determine your classification, which significantly affects your taxes and obligations.
If you're starting a Gewerbe, visit your local trade office (Gewerbeamt) first to register. This costs around 20-60 euros depending on your city. They'll issue you a Gewerbeschein.
Freelancers skip this step and go straight to tax office registration.
This is the infamous "Fragebogen zur steuerlichen Erfassung," a 7-page German form that determines your tax obligations. You must submit it within one month of starting your business.
What's Requested:
Language Barrier Solution:
The form is only available in German, which causes major headaches for expats. Use Sorted, a free web app that guides you through the form in English. Alternatively, hire a tax advisor to complete it for you (costs around 150-300 euros).
Your local Finanzamt will mail your Steuernummer within 2-8 weeks. During busy periods, this can take longer. You cannot issue proper invoices until you receive this number.
Once registered, you're required to:
Tool Recommendations:
English-friendly accounting software options:
For simple freelancing, you can manage independently using English tax software. Consider hiring a tax advisor (Steuerberater) if you:
Tax advisor costs: 500-1,500+ euros annually depending on complexity.
This is one of the most common questions expats ask, and the answer is: it depends on your home country and your specific situation.
Germany taxes you based on residency, not citizenship. If you live in Germany for more than 183 days per year, you're considered a German tax resident and must file German taxes on your worldwide income.
However, some countries (notably the United States) tax based on citizenship, meaning American expats must file U.S. taxes regardless of where they live.
Germany has double taxation agreements with over 90 countries, including the U.S., UK, Canada, Australia, and most EU nations. These agreements prevent you from paying full taxes twice on the same income.
How it works:
Let's say you're American working in Germany. You'll:
United States: Must file annually regardless of residence. Use Form 2555 (Foreign Earned Income Exclusion) or Form 1116 (Foreign Tax Credit). The first approximately $120,000 of earned income can be excluded.
United Kingdom: If you're non-resident for tax purposes, you generally don't file UK taxes. Check HMRC's Statutory Residence Test.
Canada: Once you're non-resident, you typically don't file Canadian taxes unless you have Canadian income sources.
Australia: Similar to UK - non-residents generally don't file unless they have Australian income.
EU Countries: Each has specific rules, but generally if you're tax resident in Germany, you file here.
Rental income, investment gains, or pension payments from your home country must be reported on your German tax return. Germany will tax this income, but you can often claim credits for any taxes already paid abroad.
International tax situations get complicated quickly. Consider consulting:
Cost: Expect to pay 300-1,000 euros for international tax consulting depending on complexity.
The Problem: Many expats use these terms interchangeably and provide the wrong number to their employer or Finanzamt.
The Fix: Tax ID (11 digits) is for everyone. Tax number (10-11 digits with slashes) is only for business owners and freelancers. Know which one you're being asked for.
Real Example: "I gave my employer my tax number instead of my Tax ID because I thought they were the same thing. It took three months to sort out the payroll mess."
The Problem: Your Tax ID letter gets returned as undeliverable because the postal worker couldn't confirm you live there.
The Fix: Put your name on your mailbox immediately after moving in. Use your full name exactly as it appears on your Anmeldung confirmation.
The Problem: Registering a Gewerbe when you should be a freelancer means paying unnecessary trade tax (Gewerbesteuer) of 7-17%.
The Fix: Research whether your profession qualifies as Freiberufler before registering. When in doubt, consult a tax advisor before registration, not after.
The Problem: While technically possible, you'll be taxed at the highest rate (tax class 6) and have to wait months for refunds.
The Fix: If your Tax ID hasn't arrived and you need to start work urgently, visit your Finanzamt in person with your passport to get it immediately rather than waiting for mail.
The Problem: Many people assume that because their employer withholds taxes, they never need to file. But certain situations mandate filing:
The Fix: Check filing requirements or use English tax software like Taxfix or SteuerGo that will tell you if you must file.
The Problem: Official tax letters look scary, especially in German, so people ignore them hoping they'll go away. They won't. Ignored deadlines lead to penalties and estimated tax bills.
The Fix: Get every Finanzamt letter translated immediately (use DeepL or a tax advisor). Respond to all requests by the deadline. If you need more time, request an extension in writing.
The Problem: You can deduct work-related expenses from your taxable income, but only with documentation.
The Fix: Keep receipts for:
Even if you don't file a tax return this year, keep receipts for 4 years in case you file retroactively.
Cost: Free
Processing time: 2-6 weeks
Re-issue if lost: Free
Registration cost: Free
Processing time: 2-8 weeks
Required for: Freelancers and business owners only
Registration cost: Free
Processing time: 2-8 weeks
Required for: EU business transactions only
Cost: 20-60 euros depending on city
Where: Local trade office (Gewerbeamt)
Munich: 30 euros
Berlin: 26 euros
Frankfurt: 40 euros
Hamburg: 30 euros
Cologne: 26 euros
Tax advisor for initial consultation: 150-300 euros
Annual tax return preparation (employee): 200-500 euros
Annual tax return preparation (freelancer): 500-1,500 euros
International tax consulting: 300-1,000+ euros
Online tax software (English): 30-50 euros per year
Late filing penalties: Up to 25,000 euros (in extreme cases)
Interest on unpaid taxes: 0.5% per month (6% annually)
Estimated tax assessments: If you don't file, the Finanzamt estimates (usually too high)
If you're receiving social benefits or have very low income, some fees may be waived. Ask your Finanzamt about "Erlass" (exemption) possibilities.
Best for employees with straightforward situations:
Taxfix - User-friendly app in English, average refund of 1,000+ euros, costs around 40 euros
SteuerGo - Web-based platform, entirely in English, costs around 35 euros
Smartsteuer - Comprehensive features, English interface, costs around 35 euros
Wundertax - Simple interface, good for beginners, costs around 30 euros
All these platforms let you enter your data first and see your estimated refund before paying.
When you need personalized help:
How to find them:
What to ask during first consultation:
Red flags:
Your Finanzamt - Many have some English-speaking staff. Call and ask. Worst case, they say no.
Expat communities - Facebook groups like "Expats in Berlin," "International People in Munich" share advice
University services - If you're a student, your university may offer free tax help
Consider paying for a tax advisor if:
The cost of a tax advisor often pays for itself through deductions you wouldn't have known to claim.
Yes. Your employer will deduct taxes at the highest rate (tax class 6) until you provide your Tax ID. You'll get overpaid taxes back when you file your tax return. This is inconvenient but legal and common for new arrivals.
Typically 2-6 weeks after registering your address. During busy periods (like September when many people move), it can take up to 8 weeks. If it takes longer, contact the Bundeszentralamt für Steuern or visit your Finanzamt in person.
Your Tax ID stays the same forever. Update your address when you do your next Anmeldung, but your Tax ID number never changes. If you're self-employed, you may get a new tax number from your new local Finanzamt.
No. Your Tax ID arrives by mail; no bank account is needed. However, you will need a German bank account for your employer to pay your salary.
No. Every individual has their own unique Tax ID, including children. Married couples file taxes together but use separate Tax IDs on the forms.
Your Tax ID remains valid and stored in the German system. If you return to Germany later, you'll use the same Tax ID. However, once you're no longer a German tax resident, you generally don't need to file German taxes (unless you still have German income sources).
Yes. Everyone living and working in Germany needs a German Tax ID regardless of citizenship. Your home country tax number is separate and serves different purposes.
Official forms are in German, but you can use English-language tax software that translates everything for you. Tax advisors who speak English can also file on your behalf.
There's no personal deadline, but you need it to be paid correctly. Request it as soon as you register your address. If starting a job immediately, explain to your employer it's pending.
This is a common misconception. Explain that you can work under tax class 6 until your Tax ID arrives. Show them information from the Finanzamt website confirming this. If they still refuse, contact a labor lawyer or the Finanzamt directly for clarification.
It depends. If you only had one job and straightforward income, filing is voluntary. However, filing often results in refunds since your annual income was lower than a full year. You have up to 4 years to file voluntary returns.
You'll likely file in both countries. Report German income on your German return and your home country's income on their return. Double taxation agreements prevent paying full taxes twice. Consider hiring an international tax advisor for your first year.
Not usually. The Bundeszentralamt für Steuern requires your personal information and issues the Tax ID to your registered address only. However, a tax advisor can help request it if you provide proper authorization.
Congratulations - you now understand the German tax identification system better than most expats who have been here for years.
Here's what to do next based on your situation:
If you just arrived in Germany:
If you never received your Tax ID:
If you're starting a business:
If you're overwhelmed: Find an English-speaking tax advisor who specializes in expat situations. The investment often saves you money through proper deductions and prevents costly mistakes.
Ready to continue your expat journey? This guide is part of our complete series helping you navigate life in Germany. Each guide builds on the previous one, taking you step-by-step through essential processes.
What comes next: Once you have your Tax ID, you'll need to understand health insurance registration, opening bank accounts, and potentially filing your first tax return. Each of these topics connects to your tax identification, making this foundational knowledge essential for everything that follows.
Remember: thousands of expats successfully navigate German tax registration every year. Yes, it's bureaucratic and sometimes frustrating, but it's completely manageable with the right information. You've got this.