We don't have to go around the bush for long.
The sobering answer for private investors is: No, negative interest cannot be deducted from tax.
The Federal Ministry of Finance dealt with the issue immediately after the European Central Bank switched to a negative deposit rate seven years ago.
It came to the conclusion that negative interest is not interest within the meaning of the Income Tax Act.
Accordingly, these may not be offset against other capital income such as positive interest.
Accordingly, interest is defined as payment for the provision of capital.
But the saver is not left with any capital, which is why his payment is not interest, but is to be understood as a custody or deposit fee.
Daniel Mohr
Editor in the economy of the Frankfurter Allgemeine Sonntagszeitung.
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The legislature has provided something for such investment costs: the saver lump sum, which has remained unchanged for twelve years at 801 euros.
In the view of the legislator, it takes sufficient account of the negative interest that more and more savers have to pay.
The FDP had criticized this approach, but last year it failed in the finance committee's plan to change the regulation.
The government and the Greens rejected the application.
The SPD pointed out that there had been negative real interest rates again and again in the past without this being taken into account for tax purposes, and also recalled the possibility of changing banks in order to avoid negative interest rates.
It looks better for companies.
You may consider negative interest as fully tax-deductible business expenses and book them as other business expenses as “ancillary costs of money transactions”.
So: follow the SPD proposal and look for another bank or become an entrepreneur.
Do you have any questions about money? Please contact Daniel Mohr at fragdenmohr@faz.de