Steuerfrei

Steuerfrei is a German adjective meaning "tax-free" or "not subject to tax." In law, it describes income, transactions, or goods that are exempt from taxation under the applicable tax code. The precise scope of the exemption depends on the jurisdiction and the tax in question (income tax, corporate tax, value-added tax, etc.).

In income tax, certain earnings or benefits are explicitly designated as steuerfrei. This can include parts of social benefits, scholarships, allowances, or reimbursements that are not counted as taxable income. Some incomes may also be tax-free up to a statutory threshold, with tax applying only above that limit.

In value-added tax (VAT) terms, steuerfrei refers to goods and services that are exempt from VAT. Common examples include certain medical and educational services, financial services, and exports or intra-community supplies under applicable rules. Other items may be taxed at a reduced rate rather than being fully tax-free, depending on the law.

Usage varies by country, and the legal conditions for steuerfrei can change with reforms. In everyday language, the term may appear on price lists or tax documents to indicate that no tax is levied on the item or income. It is distinct from terms such as steuerpflichtig (subject to tax) and steuerbefreit (tax-exempt in some formulations).