Employees who received reduced-time benefits during the coronavirus pandemic typically have to file a tax return for this period. Anyone who did not know this could face an additional payment and a late payment fee. With a few tricks, those affected can save a lot of money.

1. Why do I have to file a tax return? The short-time allowance was tax-free.

It is true: the subsidy for reduction of working hours is still tax-free. However, it increases the recipient's overall income.

Since the Treasury taxes higher incomes more, short-time workers have to pay the tax authorities a larger portion of the income paid by their employer than is automatically paid with the monthly payroll.

For this reason, workers with reduced hours must file a tax return. The tax office uses this to calculate the correct tax rate and the correct tax burden.

2. Why do I have to pay a late payment fee?

Anyone who has not yet filed a tax return for 2020 has missed all deadlines. First of all, the Tax Agency reminds delinquent taxpayers by letter. Then there is the threat of a late payment penalty. So it really elevates it. It has reached this point.

3. How much is the late payment fee?

Very high. Often even more than the additional payment, explains Peter Schmitz, CEO of the tax software WISO Steuer, in T-Online.

An example: the late fee is 0.25 percent of the assessed tax per month, but at least 25 euros per month. Anyone who files their 2020 tax return in April 2024 instead of Nov. 2, 2021, the original deadline, will be 29 months late. This corresponds to a late fee of at least 725 euros, regardless of the amount of the additional payment. In the worst case, interest will be added.

Taxpayers can appeal the late fee. If the additional payment is small, the clerk may apply a lower late fee. But it is not necessary.

Those who need it can invoke so-called “undue hardship”: they can then pay less or no surcharge.

4. Am I always threatened with an additional payment when I file my taxes?

Short-time workers almost always expect additional payment on top of their earnings. Because they are subject to higher taxes, they have to pay more taxes than before.

An exception applies to all employees who received less than 410 euros in short-time benefits: they do not have to file a tax return or return anything.

5. How can I reduce my additional payment?

Deduct costs. Unaccounted glasses, an unaccounted move: Whoever finds larger items that offset their higher income tax is often successful when appealing against the late fee. So there is no late payment fee. But the decision rests with the office. There is no guarantee.

Employees must be able to document costs. Whoever threw away the invoice for their glasses from four years ago will not be able to deduct them. Because automatically calculated flat rates apply to many areas, many employees will find it difficult to find many deductibles after a significant delay.

6. What do I do if I have not yet received a letter from the tax office?

This depends on whether you have filed tax returns before:

• WHO never filed a tax return Schmitz warns that under no circumstances should you act yourself. The tax office calculates the late fee only from the date of the first letter with the request for submission. However, if Corona short-time workers file their tax return voluntarily, their secretary will, in the worst case scenario, calculate the surcharge from the original filing date: for the year 2020, i.e. from on November 1, 2021. This will cost them much more. .
• WHO tax returns already filed You must act as quickly as possible. The original date applies to it anyway.

7. What should I do now?

Schmitz advises short-time workers to first define themselves:

1. Calculate the amount of the additional payment using online tax software.
2. Try to offset the extra payment by deducting costs.
3. If an additional payment is still due, file quickly and keep the late fee small.

If the office requires a late fee, those affected should consider an objection. This has a good chance of success if the missed payments are small or for employees who have never filed a tax return.

Those affected should under no circumstances ignore letters from the tax office: if they do not submit a tax return despite repeated requests, the authority calculates the tax revenue. This will be expensive (the office does not include additional deduction options), but it does not help: the interested party still has to file a tax return. So it is better to act immediately.