Abgeltungsteuer

The Abgeltungsteuer (German, from "Abgeltung" "settlement", "discharge" + "Steuer" "tax") is a flat tax on private income from capital. It is used in Germany, Austria, and Luxembourg.
Germany.
In Germany, the "Abgeltungsteuer" was introduced through the that passed the German Parliament on 14 August 2007. The "Abgeltungsteuer" became effective on 1 January 2009.
Earlier tax law.
In 2009 the "Abgeltungsteuer" replaced the that had been effective since 2001.
The had a procedure whereby taxable income was halved for purposes of dividend taxation. Fifty percent of income, as defined in article 3 number 40 of the Tax Act as amended in 2008, was exempt from income tax. 
Dividends and taxable capital gains from the sale of investments were taxed (if a certain exemption limit was exceeded) at only half the rate of income tax and . Profits from the sale of equity investments were not taxable if they were held for over a year.
The half revenue procedure was moot as of 1 January 2009 with the passage of the new "Abgeltungsteuer" (Article 32 of the German Income Tax Act).
Who is liable.
The taxation at the level of a shareholder (shareholders or partners) depends on whether the shareholder is an individual or a corporation:
Amount of withholding tax.
The "Abgeltungsteuer" is levied as a withholding tax. Private investor’s tax liability is settled. The already taxed capital gains are no longer recorded in the annual income tax return.
Instead of taxing with the personal tax rate of taxpayers, their income regardless of their height is taxed with the flat tax rate of 25%. The legal basis for this was amended in the Unternehmensteuerreformgesetz of 2008 in Art. 32 d of the German Income Tax Act.
The withholding tax rate according to Art. 43 a Para. 1 German Income Tax Act is 25% plus solidarity surcharge of 5.5% on the final withholding tax and possible church tax (8 or 9% of the flat tax). This makes a total of "Abgeltungsteuer" of 26.375% church tax excluded.
The surplus income from capital assets cannot be shortened by the overall deductions through lump sum or actual expenses. In their place, the saver's allowance in the amount of 801 € will be used as deduction (Art. 20 Para. 9 German Income Tax Act). However actually there are several decisions in court to rule on that restricted deduction possibility.
What is taxable.
Taxable current income.
Among the investment income are (Art. 20 Para. 1 German Income Tax Act): 
This means, profits which have been recorded and taxed only in the context of speculation are now already taxable for a holding period of more than one year.
Taxable private capital gains.
Taxable private capital gains are (Art. 20 Para. 2 German Income Tax Act):
Exemptions from the tax deduction.
The rules for the "Abgeltungsteuer" do not apply for the following:
Alternatives.
Investment income upon which flat rate tax was withhold, do not have to be declared in the annual income tax return. Only if church tax has not been withhold or the personal income tax rate is below 25%. A tax refund on the difference between the tax rates is possible (Art. 32 Para. 6 German Income Tax Act). This makes sense when the personal tax rate of the income is below 25%. The intention was that the income on investment income will not be taxed higher than their other income. A withdrawal of actual costs associated with private capital gains is however no longer permitted, the saver's allowance in the amount of 801 € will be used as deduction.
Losses.
Losses are considered as follows:
Foreign investment income.
Investment income that was generated abroad also falls under the "Abgeltungsteuer". The Federal Republic of Germany concluded with many countries double taxation agreements so that the regulations differ from each country to country. The aim is to avoid that one taxpayer is charged with similar taxes more than once on the same income for the same period. Though the "Abgeltungsteuer" is not applicable in foreign countries, the taxpayer has the responsibility to declare the income for taxation at the local tax office. Foreign taxes on capital gains are only chargeable up to a height of 25% according to German Income Tax Act (Art. 43 a Para. 3). Nevertheless, there can be possibility that losses from other securities transactions are added to the original loss. That leads to a paid tax on capital gains of more than 25% seen over the entire calendar year. Such a negative surplus will not been refunded by the tax authorities and is also not transferable to the following years.
Austria.
In Austria, a withholding tax on capital income took effect on January 1, 1993. The legal basis for the tax is the Austrian final taxation law ("Endbesteuerungsgesetz").
Luxembourg.
Since 2006, taxpayers who have tax liability in Luxembourg have been subject to a 15% flat rate withholding tax on interest income. For nonresident EU citizens who receive interest income from Luxembourg, a 20% tax rate applied through 30 June 2011, rising to 35% as of 1 July 2011 under the European Directive on the taxation of savings interest income.