How does the advance VAT return work for self-employed individuals?
November 14, 2022 | 40,00 EUR | answered by Karl Albrecht
Dear tax advisor,
I am Christian Helbig and I recently founded my own company. As a newly self-employed individual, I am now faced with the challenge of submitting the advance VAT return correctly and on time. Unfortunately, I have no experience with this topic and I am unsure of how exactly the process works.
Currently, I have monthly revenues of approximately 5,000 euros, which I generate through my services. I am liable for VAT and I want to make sure to do everything correctly to avoid any issues with the tax office. Therefore, it is important to me to fill out and submit the advance VAT return correctly.
My concerns mainly lie in not knowing which information I need to include in the advance VAT return and how to calculate it correctly. The deadlines and possible consequences of late submission also worry me.
Could you please explain to me how the advance VAT return works for self-employed individuals? What information do I need to provide and how do I calculate the VAT correctly? Are there any specific details I should be aware of? And what are the deadlines for submitting the advance VAT return?
I would greatly appreciate it if you could help me with this, so that I can fulfill my tax obligations as a self-employed individual correctly. Thank you in advance for your assistance.
Best regards,
Christian Helbig
Dear Mr. Helbig,
Thank you for your inquiry regarding the advance VAT return as a self-employed individual. As a tax advisor specializing in startups, I am pleased to assist you with this topic and provide you with all the necessary information.
The advance VAT return is a regular report that self-employed individuals and businesses must submit to the tax office to report their VAT. As a self-employed individual subject to VAT, you are required to submit this advance return monthly or quarterly, depending on your annual turnover. If your monthly turnover is 5,000 euros, you will typically be required to submit the advance VAT return monthly.
In the advance VAT return, you must declare all taxable sales you have made in the respective reporting period. This includes both your net sales and the corresponding VAT. You must calculate the gross sales you have achieved through your services and calculate the VAT from there. The VAT is usually multiplied by the applicable VAT rate (currently 19%). You then enter this calculated VAT in your advance VAT return.
In addition to taxable sales, special information you must provide in the advance VAT return includes input tax amounts that you can claim. This refers to the VAT you have paid for your business expenses. You can deduct these input tax amounts from the VAT and thus reduce your payment obligation to the tax office.
It is also important to adhere to the deadlines for submitting the advance VAT return, as there are penalties from the tax office for late or non-submission. The exact deadlines may vary depending on the federal state and reporting period, so it is advisable to familiarize yourself with the deadlines early on and adhere to them.
I hope this information helps you and answers your questions regarding the advance VAT return as a self-employed individual. If you have any further questions or need help with the implementation, please do not hesitate to contact me.
Best regards,
Karl Albrecht, Tax Advisor
