Investor rules in Germany (Deutschland)

This covers cash: current, savings and fixed-term accounts. Shares, ETFs and fund units are not deposits. They remain the customer's property, and you can claim them back if the bank fails. The scheme for private banks is run by the Entschädigungseinrichtung deutscher Banken (EdB). Savings banks and cooperative banks are covered by their own recognised protection schemes (DSGV, BVR). On a joint account each holder has their own €100,000 limit. Payout is normally automatic within 7 working days. Voluntary bank-association funds can protect more, but you have no legal right to that extra cover. Applies in 2026 (EinSiG §8).

This applies only if a bank or investment firm cannot return your money or securities, for example because of fraud or misappropriation. It does not cover market losses or bad advice. For customers of pure securities-trading firms and fund management companies, the scheme is the Entschädigungseinrichtung der Wertpapierhandelsunternehmen (EdW). For banks, it is the EdB. BaFin notes that cash claims from securities business at a bank, such as sale proceeds or distributions, fall under the bank deposit guarantee instead. Claims must be filed within one year after the compensation case is declared. Covers only money in euro or another EU currency (AnlEntG §4(1)).

Tax year 2026. Church tax applies only to members of a tax-levying religious community. It is withheld automatically by the bank, which looks up membership with the BZSt, and it slightly reduces the 25% tax (EStG §32d(1)). Rates vary by community and are not given here. The solidarity surcharge on flat-taxed capital income is charged regardless of the income-threshold exemption that applies to wage/income tax (SolZG §3(3) last sentence; §4 last sentence). Losses on selling shares can be offset only against gains on selling shares (EStG §20(6)). Investors whose personal income-tax rate is lower can ask for a comparison in their tax return ("Günstigerprüfung", EStG §32d(6)). We have not calculated a combined rate, by design.

Accumulating ETFs: the Vorabpauschale makes part of the yearly return taxable even when nothing is paid out. It is based on the fund's value at the start of the year and a base rate ("Basiszins") set by the BMF. It is reduced by any distributions and capped at the fund's actual rise in value plus distributions (InvStG §18). For tax year 2026 the Basiszins is 3.20%, announced by the BMF on 13 Jan 2026. The 2026 Vorabpauschale counts as received on 4 Jan 2027. That is when a German bank collects the tax from the clearing account, unless the allowance covers it. Distributing ETFs: distributions are taxed in the year they are paid. With either type, Vorabpauschalen already taxed reduce the taxable gain when you sell (InvStG §19). German banks apply the Teilfreistellung when withholding (EStG §43a(2)). Fund income held inside certified state pension contracts (Riester/Basisrente certified under AltZertG) is not taxed as investment income (InvStG §16(2)).

Applies to tax year 2026 (current text of EStG §20(9)). It covers all capital income combined, and actual costs such as fees cannot be deducted on top. To use it automatically, give your German bank or broker an exemption order ("Freistellungsauftrag") on the official form, including your tax ID ("Steuer-Identifikationsnummer"). You can split the €1,000 / €2,000 across several banks, but the total of all orders must not exceed it (EStG §44a(1)-(2a)). An exemption order also stops church tax from being withheld on the exempt amount (BZSt). People whose total income is below the taxable threshold can instead get a non-assessment certificate ("Nichtveranlagungs-Bescheinigung") from their tax office.

Domestic paying agents ("auszahlende Stelle") are German credit institutions, financial services institutions and securities institutions holding the securities (EStG §44(1)). They offset losses within the year, carry unused losses forward, credit foreign withholding tax up to the legal cap, apply the Freistellungsauftrag, and issue an annual tax certificate (EStG §43a(3), §45a). For most beginners with a German broker, the tax is then settled ("abgeltend"). A return is optional, for example to use an unused allowance or have foreign taxes credited (EStG §32d(4)). Capital income that has not had German tax withheld must be declared (EStG §32d(3)). The Finanzamt NRW gives funds held in custody abroad as an example. The ELSTER guide says Anlage KAP-INV covers investment income 'that was not subject to domestic tax withholding'. With a foreign broker, the investor must work out the Vorabpauschale and Teilfreistellung themselves.

No official source we opened explicitly states that Germany has no ISA/PEA equivalent. 'None comparable' is our reading after not finding one, so a tax professional should confirm it. The Altersvorsorgereformgesetz was promulgated in BGBl. 2026 I Nr. 156 on 29 May 2026. According to the federal government, new products are offered from 1 Jan 2027, including a guarantee-free Altersvorsorgedepot that can hold e.g. ETFs and a low-cost standard product with costs capped at 1.0%. The subsidy is 50% of contributions up to €360 a year, plus 25% of contributions from €360.01 to €1,800, for a maximum basic subsidy of €540. Contributions up to €6,840 are possible. There is also a €200 one-off bonus for under-25s and a child subsidy of up to €300 per child. From 2027 no new old-style Riester contracts can be signed, but existing ones continue. Self-employed people also become eligible. This is a pension product, not a general investment account: money is meant for retirement. Fund income inside certified pension contracts is not taxed as ongoing investment income (InvStG §16(2)); how payouts are taxed is not covered here, and neither is the Rürup/Basisrente.

BaFin supervises banks, financial services institutions, securities institutions, fund management companies, insurers and pension funds, and crypto-asset service providers. It also supervises the statutory compensation schemes (EdB, EdW). Its public company database ("Unternehmensdatenbank") shows which firms hold a German licence or have notified BaFin under the EU passport, and lists each licence. The data was dated 24.10.2026 when checked. Large banks are directly supervised by the ECB together with BaFin. Tax rules are set by the Federal Ministry of Finance (BMF) and run by the BZSt and the state tax offices (Finanzämter).