Tax
The partial exemption (Teilfreistellung) frees a portion of fund earnings from tax, 30% for equity funds, to offset the pre-tax burden levied at the fund level.
The partial exemption exempts a certain percentage of investment-fund earnings from withholding tax. It is designed to offset the pre-tax burden at the fund level.
Exemption rates: 30% for equity funds (>51% equity share), 15% for mixed funds (>25% equity share), 0% for pure bond funds, 80% for domestic real estate funds.
In practice: for an equity-fund gain of 1,000 EUR, only 700 EUR is taxed. The effective tax rate drops from ~26.4% to ~18.5%.
See taxes, dividends and allocation for your whole portfolio in one place.