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Construction Withholding Tax in Germany – Bauabzug­steuer

Stop losing 15% of your invoices

Do you have a construction business in Germany? At ProfiDeCon, we will make sure you receive your money in full. We will arrange an exemption from the construction withholding tax for you.

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  • We have already processed over 3,000 exemption applications

Making your business on German construction sites easier

Obtaining an exemption from the construction withholding tax (the so-called Freistellungsbescheinigung) with our help means for you:

  • Money in full: Your invoices will be paid without unnecessary deductions, allowing you to better plan investments and company growth.
  • Fast and smooth processing: We have extensive experience with German authorities. We know what they require and how to speed up the whole process.
  • A clean slate with the authorities: We will help you fulfill all registration obligations in Germany, which are a necessary condition for granting the exemption.
  • Communication in your language: You build, we communicate with the German tax authorities. We will explain everything essential clearly and in English.

With our help, you will avoid these complications:

1

Withholding of payments (Cash flow):
Without a valid exemption, you will receive remuneration reduced by the withholding tax. We will arrange a certificate that prevents this right from the start.

2

Complex processing of the Freistellung:
The process of obtaining the exemption requires communication with the Finanzamt and providing numerous documents. We will handle all this bureaucracy for you.

3

Refund of already deducted tax:
If your client has already deducted the tax and remitted it to the German tax office, don’t lose hope. We will help you file an application for a refund (Antrag auf Erstattung) and with any further communication.

4

Errors in applications and rejections:
An incorrectly filled out application or missing tax registration in Germany means a rejection. We guarantee professional accuracy and the fulfillment of all requirements.

Contact us today to book your initial consultation

Don’t wait until your first invoice arrives hundreds or thousands of euros lower.

Construction withholding tax in Germany – Key facts

Bauabzugsteuer is a 15% withholding from the consideration for construction work performed in Germany for a business or a legal entity under public law. Its application also depends on statutory exemptions and thresholds. We review your situation and arrange the necessary procedure.

Bauabzugsteuer is generally not withheld if the contractor presents a valid Freistellungsbescheinigung at the time of payment or if the statutory conditions for a threshold exemption are met. The certificate’s validity and the amount of the services must be assessed for the specific payment. We check the documents and help obtain the Freistellung.

The statutory basis is the consideration for the construction work, including VAT. Where Bauabzugsteuer applies, the customer calculates it, reports it and remits it to the competent Finanzamt on behalf of the contractor. We check the documents and explain both parties’ obligations.

The amount withheld is offset against the supplier’s tax obligations in accordance with legal rules; under certain conditions, it can also be refunded. The result depends on the tax situation and compliance with the procedural conditions. We will review the options and prepare the necessary submission.