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Refund of German construction withholding tax (§ 48c(2) EStG)

The construction withholding amount withheld and declared is first CREDITED to the contractor, in an order fixed by statute: wage tax under § 41a(1), then advance payments of income or corporation tax, then the income or corporation tax of the period in which the service was supplied, and finally the contractor's own withholding amounts under §§ 48, 48a (§ 48c(1) sentence 1 EStG). If something remains after that, crediting does not help: crediting against advance payments expressly may NOT produce a refund (§ 48c(1) sentence 3 EStG). That is what this separate application is for — on the contractor's application, the office competent under § 20a(1) AO refunds the withholding amount (§ 48c(2) sentence 1 EStG).

Up to date for 2026 — verified on September 22, 2026Official procedure, no printed formGuide: about 30 min

This content is part of the path: Construction services and construction withholding tax· Step 6 of 6· Last step of the path

Deadlines

By the end of the SECOND calendar year following the year in which the withholding amount was DECLARED
§ 48c(2) sentence 3 EStG — the period hangs on the DECLARATION, not on the withholding and not on the invoice
Longer periods under a double taxation convention are unaffected
§ 48c(2) sentence 3 EStG, second half-sentence
Crediting against advance payments applies only to instalment periods WITHIN the period of supply
§ 48c(1) sentence 2 EStG — a later instalment period is no longer available

Documents to prepare

  • ELSTER access with a certificate or an ELSTER business account
  • The declarations of the withheld amounts, with their dates
  • Invoices for the construction services supplied and details of the customer
  • Evidence of the crediting already applied under § 48c(1) EStG
  • A showing that there is no wage tax filing duty and no assessment in contemplation
  • Or a credible showing that no tax claims requiring security will arise
  • Bank details for the refund
See the procedure on the official site

No form is attached to this procedure: the link leads to the official page that describes it.

What this page gives you

The guide above and the link to the official site. ActioFin does not produce any document for this page: whatever you fill in or file is done on the official medium.

Who this applies to

  • The CONTRACTOR from whom a withholding amount has been withheld and declared and who cannot absorb it through the crediting order in § 48c(1) sentence 1 EStG
  • Anyone NOT obliged to file wage tax returns AND for whom an assessment to income or corporation tax is not in contemplation (§ 48c(2) sentence 2 EStG)
  • Or anyone who CREDIBLY SHOWS that no tax claims requiring security will arise in the assessment period — the second, independent route in the same sentence
  • Typically construction businesses whose seat or place of management is OUTSIDE the scope of the Act: § 20a(1) AO, to which § 48c(2) sentence 1 EStG refers, governs exactly that case and points to the office competent for their turnover under § 21(1) AO
  • Not the customer: they withhold and declare; the refund goes to the contractor
  • Anyone holding an exemption certificate normally does not need this route — nothing is withheld in the first place

Worked example

A drywall business without an exemption certificate has amounts withheld in 2026

The customer withholds the construction withholding amount from the invoice and declares it in July 2026 — the rate they apply is not stated on this page; it is in the construction withholding tax calculator. At the contractor's level that amount is first CREDITED, in order: against wage tax withheld and declared under § 41a(1) EStG, then against advance payments of income or corporation tax, then against the tax of the assessment period in which the service was supplied, and finally against the withholding amounts the contractor itself must declare under §§ 48, 48a EStG (§ 48c(1) sentence 1 EStG). If a balance remains, the second step of that order does not help: crediting against advance payments may not produce a refund (§ 48c(1) sentence 3 EStG), and it is in any case available only for instalment periods within the period of supply (sentence 2). The contractor therefore files the refund application. To do so it must show that it is not obliged to file wage tax returns and that an assessment is not in contemplation — or credibly show that no tax claims requiring security will arise in the assessment period (§ 48c(2) sentence 2 EStG). The period is generous but hangs on a specific event: the application must be transmitted by the end of the SECOND calendar year following the year in which the withholding amount was DECLARED (sentence 3) — so for a declaration in July 2026, by the end of 2028.

How to fill it in, step by step

  1. Work through the crediting first, not the refund: § 48c(1) sentence 1 EStG absorbs the amount in four steps, and only a balance remaining after that justifies the application.
  2. Note the time limit on the second step: crediting against advance payments applies only to instalment periods within the assessment period in which the service was supplied (§ 48c(1) sentence 2 EStG).
  3. Establish which of the two conditions in § 48c(2) sentence 2 EStG applies to you — no wage tax filing duty and no assessment in contemplation, OR a credible showing that no tax claims requiring security will arise.
  4. Identify the competent office under § 20a(1) AO, to which § 48c(2) sentence 1 EStG expressly refers.
  5. Collect the declarations of the withholding amounts: the application period depends on their DATE (§ 48c(2) sentence 3 EStG).
  6. Log in to Mein ELSTER and select the application for a refund of withholding amounts under § 48c(2) EStG.
  7. Transmit the application in the officially prescribed data format through the officially prescribed interface; only on application may the office waive this to avoid undue hardship, and the official form is then used (§ 48c(2) sentences 3 to 5 EStG).
  8. In cross-border cases, check whether a double taxation convention provides a longer period — it is unaffected (§ 48c(2) sentence 3 EStG).
  9. Expect crediting to be refused to the extent the declared amount was not remitted and there is reason to assume abuse (§ 48c(3) EStG).

Good to know

  • The crediting order is mandatory and has four steps: wage tax, advance payments, the annual tax of the period of supply, the contractor's own withholding amounts (§ 48c(1) sentence 1 nos. 1 to 4 EStG). You cannot pick the step.
  • The bar in § 48c(1) sentence 3 EStG explains why this application exists at all: crediting against advance payments may not produce a refund.
  • The application period attaches to the DECLARATION of the withholding amount, not to the withholding and not to the invoice (§ 48c(2) sentence 3 EStG) — a late declaration by the customer moves it along too.
  • Longer periods under a double taxation convention are expressly unaffected (§ 48c(2) sentence 3 EStG).
  • Electronic transmission is the rule; waiving it requires an application and the avoidance of undue hardship, and the officially prescribed form is then used (§ 48c(2) sentences 4 and 5 EStG).
  • § 20a(1) AO, to which the competence rule refers, concerns businesses supplying construction services whose residence, management or seat is OUTSIDE the scope of the Act; the office competent for their turnover under § 21(1) AO is then competent.
  • The office may refuse CREDITING to the extent the declared withholding amount was not remitted and there is reason to assume abuse (§ 48c(3) EStG).
  • The simpler route comes before the withholding: with an exemption certificate nothing is withheld, and this application becomes unnecessary.

Common mistakes

  • Applying for the refund without having exhausted crediting. § 48c(1) sentence 1 EStG absorbs the amount in four steps first.
  • Expecting crediting against advance payments to bring money back. It may not produce a refund (§ 48c(1) sentence 3 EStG).
  • Booking the credit against advance payments of a LATER period. It applies only to instalment periods within the period in which the service was supplied (§ 48c(1) sentence 2 EStG).
  • Counting the application period from the withholding or the invoice date. What counts is the year of DECLARATION of the withholding amount (§ 48c(2) sentence 3 EStG).
  • Checking only one of the two conditions in § 48c(2) sentence 2 EStG. The sentence contains two routes: the combination of no wage tax filing duty and no assessment, or a credible showing that no tax claims requiring security will arise.
  • Applying as the customer. The refund is made on the CONTRACTOR's application (§ 48c(2) sentence 1 EStG).
  • Filing on paper without the hardship application (§ 48c(2) sentences 4 and 5 EStG).
  • Assuming an unremitted withholding amount will always be credited. § 48c(3) EStG allows refusal where there is also reason to assume abuse.

Frequently asked questions

Why do I need a refund application at all?

Because crediting alone does not pay out. The withholding amount is credited in four steps under § 48c(1) sentence 1 EStG, and crediting against advance payments expressly may not produce a refund (sentence 3).

In what order is it credited?

Successively against wage tax withheld and declared under § 41a(1) EStG, advance payments of income or corporation tax, the income or corporation tax of the assessment period in which the service was supplied, and the withholding amounts the contractor itself must declare under §§ 48, 48a EStG (§ 48c(1) sentence 1 EStG).

By when must the application be filed?

By the end of the second calendar year following the year in which the withholding amount was declared; longer periods under a double taxation convention are unaffected (§ 48c(2) sentence 3 EStG).

What conditions must I meet?

The refund requires that the contractor is not obliged to file wage tax returns and that an assessment to income or corporation tax is not in contemplation, or that the contractor credibly shows that no tax claims requiring security will arise in the assessment period (§ 48c(2) sentence 2 EStG).

Which office makes the refund?

The office competent under § 20a(1) of the Fiscal Code (§ 48c(2) sentence 1 EStG). § 20a(1) AO concerns businesses supplying construction services whose residence, management or seat is outside the scope of the Act, and points to the office competent for their turnover under § 21(1) AO.

Can the office refuse crediting?

Yes, to the extent the declared withholding amount was not remitted and there is reason to assume that abuse is involved (§ 48c(3) EStG).

Go further

Compute the related amounts

Understand this form: the related course

Related forms

Official sources

Read in German

Guide and document provided for information purposes only; they do not constitute personalised legal or tax advice. Check the recipient organisation's requirements and consult a professional if needed.