is settled. The already taxed capital gains are no longer recorded in the annual income tax return. Instead of taxing with the personal tax rate of taxpayers, their income regardless of their height is taxed with the flat tax rate of 25%. The legal basis for this was amended in the Unternehmensteuerreformgesetz of 2008 in Art. 32 d of the German Income Tax Act. The withholding tax rate according to Art. 43 a Para. 1 German Income Tax Act is 25% plus solidarity surcharge of 5.5% on the final withholding tax and possible church tax (8 or 9% of the flat tax). This makes a total of Abgeltungsteuer of 26.375% church tax excluded. The surplus income from capital assets cannot be shortened by the overall deductions through lump sum or actual expenses. In their place, the saver's allowance in the amount of 801 € will be used as deduction (Art. 20 Para. 9 German Income Tax Act). However actually there are several decisions in court to rule on that restricted deduction possibility. What is taxable Taxable current income Among the investment income are (Art. 20 Para. 1 German Income Tax Act): dividends interests income from investment funds and certificates nearly all earnings from capital assets private capital gains covered options and other payments from securities and derivatives This means, profits which have been recorded and taxed only in the context of speculation are now already taxable for a holding period of more than one year. Taxable private capital gains Taxable private capital gains are (Art. 20 Para. 2 German Income Tax Act): the sale of shares of a corporation (stock or share of business) the sale of coupons (dividends or interest) the profit of forward transactions the sale of a stake on a company or a quiet participating loan the transfer of rights on mortgages, mortgages and pensions the sale of a capital life insurance and the sale of other capital assets or a position of right Exemptions from the tax deduction The rules for the Abgeltungsteuer do not apply for the following: interest payments by corporations to shareholders with a participation of 10% or more, for back to back financing and loans between related parties. In those cases the earnings will be taxed with the individual tax rate. gains from sale of shares in corporations, if the seller has been involved within the last five years at least with