[details=“English Translation”]This is for you.[/details] How do we know whether Sie refers to her or you or them in this sentence?
Since “Sie” is capitalized, we know that it’s the formal “you”. If “Sie” is at the start of the sentence, then it’s a bit less clear:
Sie sind da = “You” are there… but this could also mean “they” are there. The only thing we know for sure is that it’s not “she is there” because the verb conjugation is wrong - that would be “sie ist da”.
[details=“English Translation”]This is for you.[/details]That’s great. Danke. But how would you know when someone was speaking?
You just have to take it from context.
Sie sind sehr höflich! = You/they are very polite!
From the context of whatever conversation you’re having, it should hopefully be clear what “Sie” means there. A lot of Germans will use “die” instead of “sie” if they mean to say “they”. In that context, “die” is short for “diese da” (that there):
Die sehen sehr gut aus! = They look very nice! (literally “that there looks very nice!”)
The use of “die” is confusing at first, because it can also mean “the”, but again it’s usually clear from context what it means in the sentence. And the use of “die” helps to avoid ambiguous sentences like “Sie sehen sehr gut aus” which could mean two very different things.