Interactive Brokers German tax return with BubbleTax
Why do Interactive Brokers users need a tax report?
Interactive Brokers (IBKR) is one of the world's largest online brokers – founded in 1978 by Thomas Peterffy, listed on NASDAQ (IBKR), S&P 500 member – with access to over 150 markets in 34 countries. For German investors, however, there is one central problem: IBKR does not withhold German capital gains tax automatically and does not provide an annual tax certificate according to German law.
This means: Every IBKR user who is tax-resident in Germany must calculate their own capital gains and report them in their tax return.
BubbleTax is an independent provider and has no business relationship with Interactive Brokers. The name only describes which brokerage accounts the report works for.
What German investors need to calculate themselves
- Gains and losses from stocks, ETFs, options and futures using the FIFO method (§ 20 Abs. 4 Satz 7 EStG)
- Foreign currency gains from USD, GBP and other currency accounts (§ 20 Abs. 2 Nr. 7 EStG)
- Dividends and withholding tax with correct crediting under double taxation agreements
- Corporate actions such as stock splits, spin-offs and tender offers
- ETF advance lump sum and partial exemption according to the Investment Tax Act (InvStG)
- Conversion of all transactions to EUR using ECB reference rates
How BubbleTax solves the problem
BubbleTax processes your IBKR FlexQuery XML file and automatically creates a complete tax report:
- Export XML file – Create a FlexQuery in your IBKR account (Activity Statement, all sections, XML format)
- Upload – Upload the XML file to BubbleTax
- Automatic calculation – Our algorithm calculates all tax-relevant values
- Get PDF report – Download your finished tax report
The report contains all values for German tax forms (Anlage KAP, KAP-INV and SO) – directly transferable to your tax return or as documentation for your tax advisor.
What BubbleTax calculates
| Area | Details |
|---|---|
| Stocks & ETFs | FIFO calculation of all buys and sells |
| Options | Premiums, exercises, expiry – correctly assigned |
| Futures & CFDs | Derivatives according to § 20 Abs. 2 Nr. 3 EStG |
| Dividends | Gross/net with creditable withholding tax |
| Currency gains | FIFO calculation for all foreign currency accounts |
| Corporate actions | Splits, spin-offs, mergers, tender offers |
| ETF classification | Partial exemption and advance lump sum under InvStG |
Typical challenges with IBKR data
Options across year-end: A short put premium in December with exercise in January – two tax events in two different tax years. IBKR does not correctly reflect this.
Foreign currency FIFO: USD balances are separate economic assets for tax purposes. A stock purchase in dollars can trigger an FX gain just from the dollar outflow – BubbleTax calculates this automatically.
ETF classification: IBKR only knows "ETF". The German tax office distinguishes InvStG funds (partial exemption), ETNs (§ 20 EStG) and gold ETCs (§ 23 EStG). BubbleTax uses professional securities master data for correct classification.
In brief
The technical terms on this page, one paragraph each. Legal bases in brackets.
- Flex Query
- The configurable data export in the Interactive Brokers account management, also used by introducing brokers such as CapTrader or LYNX. BubbleTax needs it as an XML file with nine sections. Once set up, you export it again for each tax year.
- FIFO
- First In, First Out: when you sell, the units bought first count as sold first (§ 20 Abs. 4 Satz 7 EStG). This determines the acquisition cost and thus the gain or loss. IBKR uses other methods by default; BubbleTax rebuilds the positions under FIFO.
- Vorabpauschale
- A notional minimum return on fund units (§ 18 InvStG): the amount by which a fund's distributions in a calendar year fall short of the base return. It mainly affects accumulating ETFs that distribute little or nothing. BubbleTax calculates it from your holdings and distributions.
- Partial exemption (Teilfreistellung)
- A fixed share of fund income stays tax-free, depending on the fund type (§ 20 InvStG): 30 percent for equity funds, 15 percent for mixed funds, 60 percent for real estate funds, 80 percent for foreign real estate funds. It applies to distributions, the Vorabpauschale and gains from selling the units.
- InvStG
- The German Investment Tax Act governs how income from investment funds and ETFs is taxed at investor level: distributions, Vorabpauschale and disposal gains (§ 16 InvStG), with the Vorabpauschale (§ 18 InvStG) and partial exemption (§ 20 InvStG). These values belong in Anlage KAP-INV.
- Spin-off
- A corporate action: a company splits off a part and books shares of the new company into your account. For tax purposes it has to be determined whether the new shares replace the old ones and how the acquisition cost is allocated (§ 20 Abs. 4a EStG). BubbleTax detects spin-offs from the Flex Query section Corporate Actions.
- Anlage KAP
- The income tax return form for capital income: dividends, interest, gains and losses from shares and derivatives, creditable withholding tax. The report names the line for every value.
- Anlage KAP-INV
- The form for investment income without German withholding at source, as with IBKR: distributions, Vorabpauschale and gains from selling fund units (§ 16 InvStG).
- Anlage SO
- The form for other income. Relevant for investors in the case of private sales transactions under § 23 EStG; the report shows such values separately from capital income.
See for yourself before you pay.
Upload your Interactive Brokers Flex Query XML and get your full tax report.