Wegzugsteuer (German Exit Tax)

Germany's exit tax on individuals with substantial private shareholdings who cease German tax residency. Triggered when a person has been a German resident for at least 7 of the preceding 12 years AND holds 1%+ in any corporation at the time of departure. The unrealised capital gains in those shares are treated as if realised and taxed at normal German rates on exit. EU/EEA moves qualify for interest-free deferral subject to ongoing reporting; third-country moves require immediate payment or a bank guarantee. The 2022 ATAD II reform tightened the rules and expanded their scope. A similar regime (Entstrickungsbesteuerung) applies to transfer of German-held assets out of Germany.