Tax residents
As a tax resident is called in German tax law, any individual , regardless of their nationality, their residence or their habitual residence in Germany has. Such a person is subject to unlimited income tax in Germany ( Section 1 (1) sentence 1 EStG). The income earned worldwide is subject to unlimited tax liability ( world income principle ). The same applies to a legal person that has its management or its registered office in Germany ( Section 1 KStG).
The respective double taxation agreement between Germany and the third country regulates whether and to what extent income earned abroad is taxable in Germany .
