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Wage tax equalization

A wage tax equalization is a procedure to check the wage tax already paid by an employee. This process is often referred to as a "tax return" in Germany. Employees may be able to get a refund of overpaid taxes through income tax equalization. If too much tax has been withheld during the year or certain deductions or tax benefits can be claimed, this is done.

How does income tax equalization work?

In order to carry out an income tax equalization, the employee must submit a tax return. This declaration lists income, expenses and tax deductions in detail. The tax office calculates the final tax liability or refund based on this information. In order to prove the accuracy of the information, it is important to submit all relevant receipts and evidence. In Switzerland, a similar procedure is called a "tax return" or "assessment". Employees can also receive a refund here if too much tax has been withheld or deductions can be claimed by submitting a tax return.

What documents are required for income tax equalization?

Various documents are required to carry out an income tax equalization. These include payslips, evidence of income-related expenses, evidence of special expenses such as donations or medical expenses, certificates of taxes already paid and possibly evidence of other income. In order to carry out the income tax equalization correctly, it is advisable to keep all relevant receipts in a safe place.

When is it advisable to carry out income tax equalization?

It is recommended that income tax equalization is generally carried out once a year. The deadline for submitting the tax return in Germany is 31 December. However, the following year in July can be extended under certain conditions. In Switzerland, the deadline varies depending on the canton, but is often between March and September of the following year. It is advisable to make the income tax adjustment soon after receiving all relevant documents so as not to delay possible tax refunds.