MEXEM German tax return with BubbleTax
MEXEM and German taxes
MEXEM Ltd is a broker based in Nicosia, licensed by the Cypriot regulator CySEC (licence 325/17) and in the UK by the FCA (FRN 1009371). Custody, execution and account keeping run through Interactive Brokers Ireland, which makes MEXEM an introducing broker. Clients trade through the MEXEM apps for Windows, macOS and smartphone, the Web Trader or the Trader Workstation and reach more than 170 markets in over 40 countries. The website is available in German; support is multilingual.
For tax purposes the custodian's location matters: a Cypriot broker does not withhold German capital gains tax and issues no tax certificate under § 45a EStG. You declare share sales, dividends, options, funds and currency gains yourself in Anlage KAP, KAP-INV and SO.
Where the data comes from
The Flex Query export is not created in the MEXEM app but in the Interactive Brokers account management, which you access with your MEXEM credentials. The Flex Query guide applies one to one: set up the nine sections once, then export one XML file per tax year. MEXEM offers individual, joint, corporate and junior accounts, each as cash or margin account; every account has its own account number and its own Flex Query. For joint accounts the report shows the figures once; you split them between the account holders in the tax return.
What BubbleTax does with it
BubbleTax reads the XML file, rebuilds the positions using FIFO, converts every transaction at the ECB rate of the day and assigns the results to the lines of Anlage KAP, KAP-INV and SO. Multi-currency accounts are common at MEXEM (29 trading currencies); the resulting foreign currency gains are part of the calculation.
MEXEM recommends BubbleTax
MEXEM recommends BubbleTax to its German clients. MEXEM clients receive a coupon code from their broker and enter it at checkout; the coupon is applied against the purchase price. The preview of the calculated figures is visible without a coupon and without payment.
How it works
- Export the Flex Query: in the IBKR account management of your MEXEM account, XML format, period equal to the tax year
- Upload: to BubbleTax, initially as a free preview
- Redeem the coupon: enter the MEXEM coupon at checkout
- Download the report: PDF with the figures for Anlage KAP, KAP-INV and SO
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 MEXEM Flex Query XML and get your full tax report.