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Impact of starting a business on parental leave benefits

March 25, 2010 | 20,00 EUR | answered by Matthias Wander

Good day, my wife would like to start a business during her parental leave (from 01.02.2010 for 2 years). This, of course, in coordination with her employer. Parental leave benefits have been applied for 12 months.

The question now is as follows:

If the legal form of the company to be founded (entrepreneurial company) generates revenues/profits within the period during which the parental leave benefits are paid, does my wife necessarily have to receive an income from the company - which would then be taken into account for the parental leave benefits - or is it possible for my wife to not pay herself anything even though the company is making money, and instead, for example, create reserves within the company, etc.?

Thank you for your response!

Matthias Wander

Dear questioner,

Thank you for your inquiry, which I would like to answer based on the information provided and considering your situation in the context of an initial consultation.

Even if the UG generates profits, your wife is not obligated to pay herself a salary. However, you should consider that the UG must pay corporation and trade tax starting from 1 Euro profit. By employing your wife in a minor employment (mini job), the profit could be reduced. Income from minor employment is tax-free, but it is taken into account when calculating parental benefits.

I hope this gives you a first overview.

Kind regards,

Wander
Tax consultant