Exit taxation: what emigrants with property and GmbH shares need to know

When you leave Germany, most people first think about their property: what happens to it? Do I have to pay tax? What many are not aware of: there are two completely different types of tax that can become relevant when you emigrate — and they concern different assets. In this guide I explain what exit taxation really is, who it affects and what it means concretely for your emigration.

What is exit taxation (§ 6 AStG)?

Exit taxation refers to the tax under § 6 of the Foreign Tax Act (Außensteuergesetz, AStG). The principle behind it: anyone who leaves Germany while carrying shares in corporations (GmbH, AG, cooperative) should pay tax on the hidden reserves accrued during their German tax liability — even if they have not sold the shares at all.

On emigration, the state assumes a notional disposal at the current market value. So you pay tax on a gain you have not yet realised.

Conditions for § 6 AStG:

• You hold at least 1 % in a corporation (GmbH, AG, cooperative or, from 2025, an investment fund)
• You have been subject to unlimited tax liability in Germany for at least 7 years within the last 12 years
• You move your residence or habitual abode abroad

If one of these conditions is missing, § 6 AStG does not apply.

Exit taxation vs. speculation tax: the decisive difference

This is where the most common confusion lies — and it can be costly:

Property (real estate) does not fall under § 6 AStG. For the sale of a German property the following apply:

• § 23 EStG (speculation tax): the 10-year period, the owner-occupation exemption
• § 49 EStG (limited tax liability): Germany taxes property sales even after you have emigrated

GmbH/AG shares of 1 % or more fall under § 6 AStG: on emigration, tax is due on the notional sale gain, even without an actual sale.

So if you sell a property and hold GmbH shares, you have to keep both types of tax in view — they run in parallel and independently.

How is the exit tax calculated?

The calculation follows the partial income method (§ 3 No. 40 EStG):

1. Notional capital gain = current market value of the shares − acquisition costs
2. Taxable portion = gain × 60 % (40 % is tax-free)
3. Exit tax = taxable portion × personal income tax rate

Example calculation:

• GmbH share value today: €500,000
• Acquisition costs in 2015: €50,000
• Notional gain: €450,000
• Taxable (60 %): €270,000
• Exit tax at 42 % income tax: €113,400

This tax is due before you leave Germany — or, on application, in instalments.

EU emigration vs. non-EU: what has it meant since 2022?

The ATADUmsG (2022) fundamentally changed exit taxation. Previously the rule was: when emigrating to an EU country, the tax was deferred permanently — effectively interest-free until the actual sale.

Since 1 January 2022, the following applies to all emigration (EU and non-EU):

• Payment in 7 annual instalments is possible
• The tax office may demand security (especially for moves to non-EU countries)
• Application: must be filed with the income tax return for the year of emigration
• Default interest: none, as long as the instalments are paid on time

My tip: file the instalment application early — ideally still in the year of emigration. Anyone who forgets the application has to pay the entire tax at once.

Strategy: sell shares before or after emigration?

This is the question clients ask me most often when both come together — GmbH shares and a property.

Scenario A — sell the shares before emigration:

• No § 6 AStG, since you are still subject to unlimited tax liability
• Instead: normal taxation under the partial income method
• Advantage: no security, no instalment application, no follow-up obligations
• Disadvantage: pressure to sell can depress the price, not always strategically sensible

Scenario B — hold the shares after emigration:

• § 6 AStG applies on emigration (notional disposal)
• Apply for instalment payment (7 years)
• Later actual sale: the exit tax already paid is credited
• Advantage: no forced sale, value appreciation remains possible

My recommendation: if it is foreseeable that the shares will be sold within the next 2–3 years, selling before emigration may be more favourable for tax. For long-term holding, scenario B is worthwhile. This depends heavily on the individual figures — here a tax adviser with international tax law is indispensable.

Common mistakes when emigrating with GmbH shares

Mistake 1: not notifying the tax office of the emigration The tax office must be informed of the emigration. Anyone who forgets or delays this risks additional-payment interest and fines.

Mistake 2: setting the company valuation too low Tax offices scrutinise the valuation of GmbH shares closely. Anyone who sets the value too low risks an upward correction — with a correspondingly higher tax burden. A valuation report from a tax adviser is advisable.

Mistake 3: overestimating EU privileges Since 2022 there is no longer any automatic deferral. The instalment application must be filed actively and may require security. Anyone unaware of this is unpleasantly surprised.

Mistake 4: confusing exit taxation with speculation tax Some clients think the exit tax applies to their house. That is wrong — but the mistake can mean that the tax that is actually relevant (§ 23 EStG) is not planned for properly.

Mistake 5: bringing in a tax adviser too late Planning the emigration should begin at least 6–12 months before departure. Many tax-structuring options require that you are still subject to unlimited tax liability in Germany.

What a tax adviser should check for you

If you emigrate with GmbH shares, you need a tax adviser with international tax law. Specifically, they should clarify the following:

• Do you meet the 7-of-12-years condition for § 6 AStG?
• How high is the fair market value of the shares (valuation report)?
• Which double taxation agreement applies with the destination country?
• Should the shares be disposed of before or after emigration?
• Is an instalment application sensible, and what security does the tax office require?
• Are there options for offsetting losses?
• What happens to ongoing dividends after emigration?

Calculate the exit tax

You can determine a first indicative figure for your GmbH shares with our calculator:

→ To the exit tax calculator (§ 6 AStG)

Important note: the calculator provides an indicative figure based on the partial income method. The actual tax burden depends on the precise company valuation, possible loss carryforwards, the double taxation agreement with the destination country and other individual factors. Bring in a tax adviser before you make any decisions.

For comparison: what applies for tax to your property is explained by the speculation tax calculator.

Read on: property and emigration

If you are selling your property as part of emigrating, or already handling the sale from abroad:

• Selling a house when emigrating — all aspects at a glance
• Selling property from abroad — power of attorney, remote handling and tax liability