Twitch Taxes in Germany 2026: Subs, Bits and Donations

Twitch income – subs, bits, ad revenue, sponsorships and donations – is normally business income under § 15 EStG if you live in Germany; trade tax only applies to profit above the €24,500 allowance (§ 11 GewStG). Payouts from Twitch itself are usually not subject to German VAT, because under § 3(11a) UStG the platform counts as the supplier to your viewers. Donations sent directly via PayPal or Streamlabs are different: they are usually domestic supplies and count towards the €25,000 small business limit.

Which Twitch income you have to declare

For tax purposes, every payment connected with your channel counts. The name of the feature on the platform does not matter. Business income includes in particular:

• Subs and gift subs: your share of subscription revenue paid out by Twitch.

• Bits and cheers: what Twitch pays you for bits used in your chat.

• Ad revenue: your share of ad breaks.

• Donations and tips: payments via PayPal, Streamlabs, StreamElements or Ko-fi.

• Sponsorships and brand deals: money or products from brands for overlays, codes or product placements.

• Other income: affiliate commissions, merch sales and tournament prize money.

Streaming with the aim of making a profit is a trade (Gewerbe). Classification as a freelance artistic activity under § 18 EStG is the exception. You therefore register a business with your local trade office (Gewerbeamt) and then complete the tax registration questionnaire in ELSTER. There is no minimum income below which registration is not required. The steps are explained in registering as a self-employed creator.

Payments in kind are income too. If a brand sends you hardware or a game in return for featuring it on stream, the value of the product is business income.

Key tax figures 2026 for streamers

Trade income is rounded down to full €100 before the allowance is deducted. For most streamers with a profit below €24,500, trade tax plays no role. An overview of all taxes is in taxes for content creators in Germany.

VAT: which income is treated how

For VAT, what matters is who your customer is. For subs, bits and ads, your customer is not the individual viewer but the platform. § 3(11a) UStG treats a platform that sets the general terms as if it had bought your service and resold it to the viewer. The Court of Justice of the EU confirmed the underlying EU rule for OnlyFans on 28 February 2023 (C-695/20, Fenix International). You supply a business, and the place of supply is where that business is established (§ 3a(2) UStG).

"Not taxable" (nicht steuerbar) means the supply falls outside German VAT law altogether because it takes place abroad. Only taxable supplies count towards total turnover under § 19(2) UStG. Twitch payouts therefore do not use up your €25,000 limit.

Which Twitch entity pays you

Twitch belongs to the Amazon group. Your contracting entity is named in your monetisation agreement, in the tax section of the Creator Dashboard and on your payout statements. Your reporting duties depend on it:

• Entity outside the EU, for example in the US: The payout is not taxable in Germany. If you are VAT-registered, you report it in your VAT return as other non-taxable supplies. No EC Sales List.

• Entity in another EU country: The recipient owes VAT in its own country (reverse charge). If you are VAT-registered, you report the supply in your VAT return and in the EC Sales List. Invoices or self-billing statements need both VAT IDs and the note "Steuerschuldnerschaft des Leistungsempfängers" (reverse charge), § 14a(1) UStG.

Why direct donations are different

PayPal, Streamlabs and StreamElements only process payments. A service provider that only handles payments and is not involved in the supply does not fall under the platform rule (last sentence of § 3(11a) UStG). The donation goes straight from the viewer to you. If it comes from a private person in Germany, it is a domestic supply. Under the small business regulation it stays VAT-exempt, but it counts towards your total turnover. Details in the small business regulation explained.

Donations: what the tax courts say

Many streamers assume donations are gifts. Most case law disagrees.

• Tax Court of Düsseldorf, 4 March 2022, 1 K 2812/19 U: A streamer received money through a donation panel in addition to subs. The court treated the payments as consideration for an entertainment service, subject to 19% VAT. That viewers paid voluntarily and chose the amount did not change this. The court rejected the comparison with the street musician from the EU case Tolsma (C-16/93), because viewers deliberately visit the channel.

• Tax Court of Berlin-Brandenburg, 25 April 2025, 2 K 2085/21: For a blog receiving donations and sponsorships without a specific return, the court found no taxable supply for VAT.

• Tax Court of Berlin-Brandenburg, 12 June 2025, 14 K 14067/24: For income tax, the court treated voluntary payments to a blogger as business income.

Appeals on both questions are pending at the Federal Fiscal Court (BFH): V R 10/25 on VAT and VIII R 18/25 on income tax. The law is therefore not finally settled. For a stream with a donation button, alerts and messages read out on stream, the facts are close to the Düsseldorf case.

The income tax exemption for tips in § 3 No. 51 EStG does not help. It only applies to employees receiving tips from third parties. More in donations and tips for creators (in German).

US tax interview and withholding

Twitch asks you to complete a tax interview in the Creator Dashboard, run through Amazon's tax information interview. If you live in Germany, this normally results in a Form W-8BEN. With it you confirm that you are not a US taxpayer and claim the benefits of the Germany–US tax treaty.

The background: income that the US treats as US-source royalties is subject to a 30% withholding tax for recipients in countries without a treaty rate. For copyright royalties paid to residents of Germany, the IRS treaty table lists 0% (Art. 12(1) of the treaty). How Twitch classifies each type of revenue is shown in your tax interview and on the Form 1042-S you receive. The W-8BEN is valid until the end of the third calendar year after you sign it and must then be renewed.

If US tax was withheld although the treaty rate is 0%, the German tax office will generally not credit it (§ 34c(6) EStG). You would have to reclaim it in the US. A correctly completed tax interview is the easier route. The same mechanism is explained step by step in YouTube taxes in Germany.

EU-resident streamers are also asked to complete a separate DAC7 interview. Under the EU reporting rules for platforms, your earnings data can be passed on to the tax authorities.

Worked example: streamer with Twitch, donations and a sponsorship

Example: A single streamer in Cologne had total turnover of €18,000 in 2025. In 2026 she earns the following. According to her payout statements, her Twitch contracting entity is based outside the EU. Her donations come from viewers in Germany.

She remains under the small business regulation in 2026, because her previous-year turnover was below €25,000 and her current-year turnover stays below €100,000. With €17,000 she also stays below the previous-year limit for 2027. Had she counted all €47,000, she would wrongly believe she must charge VAT from 2027. For donations from private viewers she would then owe 19/119 of the amount received, which is €1,436.97 on €9,000.

Her expenses for hardware, software, internet and a home office are €12,000. For simplicity, trade income equals profit.

Trade tax itself is not a deductible business expense. Church tax and social insurance are left out. You can recalculate the trade tax with the trade tax calculator (in German) and read more in trade tax for creators.

Special cases

• Charity streams: If viewers donate directly to a charity through its own tool, the money never touches your business. If it goes through your account, it is first your business income, and passing it on must be assessed separately. Clarify the payment route before the stream.

• Multistreaming: If you stream on YouTube or TikTok at the same time, each platform's own contracting entity determines the VAT treatment.

• Direct donations from other EU countries: Whether the viewer's country VAT applies depends on whether the stream counts as an electronically supplied service (§ 3a(5) UStG, €10,000 EU-wide threshold). For interactive livestreams this is not finally settled and should be checked for larger amounts.

• Products instead of money: A sponsorship paid in goods is a barter-like transaction. The value of the goods is the taxable amount.

• Agencies or software from abroad: For services bought from foreign businesses, you owe German VAT yourself under § 13b UStG, even as a small business. Small businesses cannot deduct it and must file VAT returns for those periods.

• Esports and tournaments: Prize money and team contracts follow their own rules, see gamers and esports (in German).

Common mistakes

• Treating donations as gifts: They are business income and, according to the Düsseldorf ruling, usually subject to VAT.

• Paying 19% VAT on Twitch payouts: The supply to the platform is not taxable in Germany.

• Counting Twitch payouts towards the small business limit: This often leads to unnecessary VAT registration.

• Forgetting direct donations in the limit: They are domestic supplies and can exceed €25,000 on their own.

• Booking PayPal or Streamlabs payouts net: The full amount paid is income; the fees are a business expense.

• Not checking the contracting entity: Whether an EC Sales List is needed depends on where the paying entity is based. Check again whenever the terms change.

• Ignoring the tax interview: Without a valid W-8BEN, US tax may be withheld that is not creditable in Germany.

• Not registering a business: The obligation starts with your first payout, not at a certain amount.

CAPSIVERA is a tax advisory firm in Cologne specialising in content creators, crafts and building services.