Vorabpauschale (advance lump sum)

An accumulating ETF pays nothing out — yet German tax law still asks you to tax a small, formula-based amount every year: the Vorabpauschale. It makes sure that funds which retain their gains are still taxed as you go (§ 18 InvStG).

How it is calculated

Three steps, in this order:

1. Base return (Basisertrag) = redemption price at the start of the year × base rate × 70 % (§ 18 Abs. 1 InvStG). In practice the start-of-year price is the last redemption price of the previous year. The base rate (Basiszins) is published each year by the BMF — 2.29 % for 2024, 2.53 % for 2025. What counts is the base rate of the year the Vorabpauschale is calculated for.
2. The cap: the base return is limited to the fund's actual rise in value over the year (price gain plus distributions). If the fund fell in value, the Vorabpauschale is 0.
3. Less distributions: whatever the fund already paid out during the year is subtracted. The Vorabpauschale can never go negative.

Purchase year and accrual

In the year you buy, the Vorabpauschale is reduced pro rata — by 1/12 for each full month before your purchase month (§ 18 Abs. 2 InvStG). Buy in March and January and February drop out.

The accrual date matters: a given year's Vorabpauschale is deemed to accrue only on the first working day of the following year (§ 18 Abs. 3 InvStG). So the 2024 Vorabpauschale belongs on your 2025 return, not 2024 — a common mistake.

Teilfreistellung (partial exemption)

As with all fund income, part of the Vorabpauschale is tax-free up front (§ 20 InvStG): equity funds 30 %, mixed funds 15 %, property funds 60 %, foreign-property funds 80 %. Which rate applies depends on the fund type per its prospectus (Anlagebedingungen). You set it in capi.tax, because the broker data does not state it.

The catch with US brokers

Interactive Brokers, Tastytrade and DEGIRO withhold no German tax and usually do not include the year-start and year-end redemption prices the calculation needs. You can get them from the fund company, for example. And take care: many US-domiciled ETFs are still investment funds under the InvStG — "US ETF" does not mean "no Vorabpauschale." All of this is declared on Anlage KAP-INV.

How to enter it in capi.tax

Because the Vorabpauschale belongs to the following year, its figures come from the previous year — for the 2025 return, from 2024. Your 2025 broker export does not contain them. So you enter them yourself, and capi.tax does the calculation:

1. In the results, open the Adjustments tab and scroll to the Record Vorabpauschale card. (This is not available in the demo — you need your own file.)
2. For each fund, enter: the symbol as in your broker data, the calendar year (preset to the previous year), the fund type, the fund currency, the redemption prices per share at the start and end of the year, the distributions per share in the year and the shares from this purchase held on 31 Dec. For distributions, use the total of all the fund's distributions in the year, gross before withholding tax — including those before your purchase; for accumulating funds enter 0. The fund type is preset if you already set it in the symbol classification.
3. If you bought the shares during the calendar year you entered (for the 2025 return, in 2024), under Bought choose the year (e.g. In 2024) and the purchase month. Enter shares from different purchase months as separate entries — each with only the shares from that purchase still held on 31 Dec. Example: 100 shares from 2023 plus 20 bought in March 2024 → two entries: 100 shares "Before 2024" and 20 shares "In 2024", March. If you sold during the year, the oldest shares count as sold first (FIFO).
4. capi.tax shows you the calculation — base rate, time share, amount per share and, if needed, the exchange rate — and Apply & recalculate adds the Vorabpauschale to your result.

You then find it on the Overview tab in the Vorabpauschale section; the taxable part (after the partial exemption) goes into the overall totals. The gross amount for Anlage KAP-INV is in the result for the following year (Vorabpauschale 2024 → result 2025), on the KAP Form tab, below the Anlage KAP table in the Anlage KAP-INV section: depending on the fund type in line 9 (equity fund), 10 (mixed fund), 11 (property fund), 12 (foreign-property fund) or 13 (other investment fund) — as on the 2024 and 2025 forms; later forms may change the line numbers. The fund kind you chose when recording it decides the line.

Good to know:

• Foreign currency: if the fund is priced in, say, US dollars, capi.tax calculates in dollars and converts the result to euros at the Bundesbank reference rate of the accrual date (first working day of the following year). The literature is not fully settled on this conversion.
• Exchange prices instead of the redemption price are only an approximation. In a year with almost no change in value, this can noticeably change the result.
• Earlier years: a Vorabpauschale for an older year is not taxed in this tax year and does not appear in the Vorabpauschale section. If you sell the fund this year, you should still record it: capi.tax then credits it against the sale gain (§ 19 Abs. 1 Satz 4 InvStG); otherwise it is taxed twice.
• US ETFs and fund type: US fund documents often state no equity quota in the sense of the InvStG. The fund type follows the fund's prospectus (see Teilfreistellung); if it states no equity quota, best settle the classification with a tax advisor. It also decides the KAP-INV line.

Distributions and sale gains on your funds are included in capi.tax's figures anyway.

See also: Where the fund figures go on the forms: Anlage KAP, KAP-INV & SO.

Last updated: October 12, 2026