With just 30,000 euros to be taxed, the marginal tax rate rises by over 30 percent. Usually, taxpayers are annoyed by a high marginal tax rate. So they have little left of the hard-won after-tax salary increase when the marginal tax rate is already high. When it comes to saving taxes, however, the picture is turning: Now the savings potential is greater, the higher the marginal tax rate.
The main aim is to deduct certain expenses. Such expenses are then deducted from income before the tax payable is calculated. The basic idea behind this is that the tax should be based on financial performance. But I’m only more productive if I really get income. However, if high costs were incurred which – like an investment – first led to the income, the tax office must take them into account. For some expenditure blocks, such as professional expenditure, flat rates can be used; for salaried employees this is 1000 euros per year. These lump sums are intended to save taxpayers the hassle of having to prove every small expense. The tax office also benefits from the reduced effort. However, if the actual expenditure is higher, individual proof is required.