Interest: credit, margin & accrued interest

At your broker, interest flows both ways: you receive credit interest (Habenzinsen) on your cash balance, and you pay debit interest (Sollzinsen) on a margin loan. German tax treats the two completely differently: credit interest is taxable, debit interest is not deductible — and you may not net one against the other.

Overview

Credit interest

Interest on your cash at the broker is capital income under § 20 Abs. 1 Nr. 7 EStG. It is subject to the flat tax of 25 % plus solidarity surcharge and counts towards the saver's allowance (Sparer-Pauschbetrag: €1,000 from 2023, €801 before).

• Gross: you report the interest as credited. Fees or debit interest are not deducted.
• Timing: the year in which the interest is received counts (§ 11 Abs. 1 S. 1 EStG) – with one exception at the turn of the year, see below.
• Euro: capi.tax converts interest in dollars or another currency at the Deutsche Bundesbank reference rate on the day it is credited — see Currency conversion.
• Anlage KAP: because your broker withholds no German tax, the interest goes in line 19 (foreign capital income; so on the 2021 to 2025 forms), together with dividends and the results from shares and derivatives. See Anlage KAP, KAP-INV & SO.
• Offsetting losses: interest belongs to the general loss pot. Losses from options, futures, bonds or funds offset it; losses from selling shares do not (§ 20 Abs. 6 S. 4 EStG) — see Offsetting losses.

December interest credited in January

Interactive Brokers credits a month's interest only in the first days of the following month – December 2024 interest arrives in early January 2025. Interest is regularly recurring income: if it is received by 10 January, it still belongs to the previous year for tax purposes (§ 11 Abs. 1 S. 2 EStG).

capi.tax handles this automatically: an interest credit "for December" booked between 1 and 10 January counts in the previous year. It is still converted at the rate of the booking date.

Your annual statement ends on 31 December, though – December's interest is only in the following year's statement. So for tax year 2024, also upload a 2025 statement that runs at least to 10 January – how, see January statement for December interest. From that file capi.tax takes only the December interest for 2024. If it is missing, you get a processing notice. Conversely, capi.tax leaves the previous year's December interest booked in early January out of the tax year – it belongs in the previous year's return.

Withholding tax on interest

The US normally withholds nothing on interest paid to private investors with a W-8BEN: under Art. 11 of the Germany–US treaty, only Germany may tax interest. If US tax is withheld anyway, it is not creditable in Germany — you can only reclaim it in the US. Note: distributions from US bond ETFs are not interest but fund income. More under Withholding tax.

Debit interest

If you borrow from your broker — for example because your account goes negative after a purchase or an option assignment — you pay debit interest. For tax purposes this is an expense (Werbungskosten), and beyond the saver's allowance such expenses are not deductible from capital income (§ 20 Abs. 9 S. 1 Hs. 2 EStG). In practice:

• No deduction: debit interest does not reduce your capital income, not even if you apply for the Günstigerprüfung (assessment at your personal rate).
• No netting: €300 of credit interest and €200 of debit interest is €300 of interest for tax purposes, not €100. That holds even when both arise in the same account in the same month.
• Other income types: if the loan does not finance your portfolio but, say, a rental property or your business, the interest may be deductible there. That is rare for margin loans; check such a case with a tax advisor.

capi.tax recognises debit interest in your export — at Tastytrade by the sub type Debit Interest, at Interactive Brokers by the description (Debit Interest or Sollzinsen) or, in a Flex Query, by the type Broker Interest Paid — and leaves it out of the calculation. A negative interest entry that cannot be classified unambiguously — a correction of an interest credit, say — is also treated as not deductible, and capi.tax names it in a processing notice. The notice also says when to deduct the amount from line 19 yourself: reversing an excess interest credit reduces your interest, negative interest does not. You find it in the results on the Audit Trail tab under Ignored Transactions, with the reason "Margin interest - not deductible".

Negative interest and custody charges

If your broker charges interest on a euro balance, the tax authorities do not treat it as negative interest but as a custody and deposit fee (BMF letter of 14 May 2025, para. 129a). It is covered by the saver's allowance and does not reduce your interest. capi.tax therefore does not deduct such entries.

Bonds and accrued interest

Coupons on a bond are interest under § 20 Abs. 1 Nr. 7 EStG and go in line 19 like credit interest. capi.tax takes them from the interest section of your export into the Interest category.

Sale and redemption

When you sell a bond or it is repaid at maturity, the difference between proceeds and purchase price is a capital gain or loss (§ 20 Abs. 2 S. 1 Nr. 7 EStG). Repayment counts as a sale (§ 20 Abs. 2 S. 2 EStG). capi.tax calculates this for Interactive Brokers in the Bonds category:

• Price in percent: IBKR quotes bonds in percent of face value. USD 10,000 nominal at 98.5 % costs USD 9,850. capi.tax takes the amount IBKR itself reports and matches sales by FIFO on the nominal.
• In euros: capi.tax converts the purchase price at the Bundesbank rate on the purchase date and the proceeds at the rate on the sale or repayment date (§ 20 Abs. 4 S. 1 EStG). An exchange-rate change in between is part of the gain. Fees reduce the gain.
• Repayment at maturity: IBKR books it as a corporate action, not as a sale. capi.tax always recognises it in a Flex Query. In the activity statement (CSV), capi.tax needs the Financial Instrument Information section (German: Finanzinstrument-Informationen) for it: it links the ISIN in the description to the bond. Without it, the bond stays open and you get a processing notice.
• Anlage KAP: gains and losses are netted in line 19, losses are also entered in line 22. Bonds are not shares: lines 20 and 23 are not affected.
• German issuers – line 18: whether income is domestic depends on where the debtor is seated, not on the broker (§ 34d Nr. 6 EStG). The gain, coupons and accrued interest of a bond from a German issuer – a Bund held at IBKR, say – therefore go in line 18; losses also go in line 22. The tax is the same. capi.tax takes the issuer's country from the Flex Query. The activity statement does not have it; capi.tax then derives it from the ISIN (DE = German) and shows a processing notice, because the ISIN does not reliably show the seat.
• Loss offsetting: bond losses go into the general loss pot and reduce interest, dividends and other gains. Losses from share sales, however, do not reduce bond gains (§ 20 Abs. 6 S. 4 EStG) — see Offsetting losses.

US Treasury bills and other discount papers pay no coupons. The difference between purchase price and redemption is not interest but a gain on redemption (§ 20 Abs. 2 S. 1 Nr. 7, S. 2 EStG). capi.tax calculates it like any other bond, in euros and therefore including the exchange-rate change between purchase and maturity.

Accrued interest

Accrued interest (Stückzinsen) is the interest built up since the last coupon date, settled between buyer and seller when a bond is traded:

• Accrued interest paid on a purchase is negative income in the year of payment. It reduces your capital income and therefore line 19 (line 18 for a German issuer).
• Accrued interest received on a sale is part of the sale proceeds (§ 20 Abs. 2 S. 1 Nr. 7 EStG).

IBKR does not book accrued interest with the bond's price but as a separate line in the interest section — in a Flex Query with the type Bond Interest Paid or Bond Interest Received, in the activity statement with the description ACCRUED INT. capi.tax counts each entry exactly once. Accrued interest paid reduces your interest. Accrued interest received is assigned to the sale and added to the sale proceeds – when the link is unambiguous: the entry names the bond, is booked up to seven days after the sale, and only one sale fits. In a Flex Query it must also match the accrued interest IBKR reports on the sale itself. If the link is not unambiguous – two sales of the same bond on the same day, say – capi.tax counts the entry as interest and shows a processing notice. Line 19 and the tax are still right; only for a bond sold at a loss does line 22 show the loss before the accrued interest.

What is not calculated

• Short sales of bonds (sale to open, purchase to close): you owe the lender the coupons and accrued interest, and the export does not link them to the position. capi.tax leaves these trades out and shows a processing notice. You determine the gain or loss yourself.
• Convertible and reverse convertible bonds settled in shares, and defaults of a bond: capi.tax does not calculate such corporate actions without a cash repayment but reports them as a processing notice – in the activity statement as "Bond corporate action not assigned", in a Flex Query as "Corporate actions not applied". You determine the result yourself.
• Tastytrade: capi.tax calculates bonds only from Interactive Brokers exports.

Frequently asked questions

Can I deduct margin interest from my option gains?

No. Debit interest is an expense, and beyond the saver's allowance expenses are not deductible from capital income (§ 20 Abs. 9 EStG). That applies even if you use the loan only for options trading.

Do I have to report interest below the saver's allowance?

Yes. Because your broker withholds no German tax, you report all capital income on Anlage KAP, small amounts included (§ 32d Abs. 3 EStG). The tax office then deducts the saver's allowance.

How is securities lending income (Stock Yield Enhancement) at IBKR treated?

That is not conclusively settled. Interactive Brokers books these payments in its interest section, so capi.tax treats them as interest in line 19. Some argue they are other income under § 22 Nr. 3 EStG (Anlage SO). For larger amounts, best clarify the classification with a tax advisor.

Does interest on a dollar balance also count as a currency gain?

The interest itself is capital income, converted at the rate on the day it is credited. Whether the interest-bearing dollar balance additionally triggers a currency gain when you exchange it later is a separate question — see Currency gains.

capi.tax prepares your data and is not tax advice. Please review the figures and ask a tax advisor (Steuerberater) about your personal situation.

Last updated: October 10, 2026