What tax obligations do I have as the founder of a start-up?
October 4, 2022 | 50,00 EUR | answered by Ulrike Voss
Dear Tax Lawyer,
I am Christine Weinert and I recently founded a start-up. I am now faced with the question of what tax obligations I, as the founder, will have to fulfill. I have never dealt with tax matters before and I am therefore somewhat unsure of how to correctly meet the tax requirements.
Currently, I am operating as a sole proprietor and have not yet hired any employees. My company is still in its early stages and I expect steady growth in the coming years. I am aware that it is important to comply with tax regulations from the beginning in order to avoid problems with the tax authorities later on.
My specific concerns mainly revolve around which taxes I, as the founder of a start-up, have to pay, how to correctly tax my income, and what tax benefits are available for start-ups. I am also interested in knowing if there are certain deadlines to be met and what documents I will need for tax filing.
Could you please provide me with an overview of my tax obligations as the founder of a start-up and suggest possible solutions on how I can best manage them? I want to ensure that my company is set up correctly in terms of taxes and that I do not incur any financial risks.
Thank you in advance for your support.
Sincerely,
Christine Weinert
Dear Ms. Weinert,
Thank you for your inquiry regarding your tax obligations as the founder of a start-up. As a tax lawyer, I can provide you with an overview of the key tax aspects for your business.
As a sole proprietor, you are generally required to pay various taxes. The most important taxes for your start-up include income tax, value-added tax, and possibly trade tax. Income tax is levied on the profit from your business, while value-added tax is calculated on the services provided or goods sold by you. Trade tax is only applicable if your company is classified as a commercial enterprise and generates trade income.
To correctly declare your income, it is important to properly document all income and expenses of your business. This includes invoices, receipts, and bank statements. For tax returns, you will also need an income-expenditure account (EÜR) or a profit and loss statement (GuV), depending on how you organize your bookkeeping.
There are also tax incentives specifically for start-ups, such as the research tax credit or tax support for start-ups. It is therefore worthwhile to inform yourself about these opportunities and potentially take advantage of them.
To avoid missing deadlines and potential financial risks, I recommend contacting a tax advisor or tax lawyer early on. An expert can help you fulfill your tax obligations and inform you about all relevant tax aspects.
I hope this information is helpful to you and I am available for any further questions. I wish you success with your start-up and a prosperous entrepreneurial future.
Sincerely,
Ulrike Voss
Tax Lawyer
