Capital gains tax in the GmbH
October 20, 2010 | 30,00 EUR | answered by Oliver Burchardt
I am considering whether a GmbH can be a sensible structure for my private asset management. The following question is crucial for me:
How are capital gains (especially interest income from bonds, price increases of funds, certificates, commodities, etc.) taxed at the level of the GmbH with capital gains tax, corporate and trade tax, and does the distribution of the remaining income at the shareholder level again lead to capital gains tax?
To illustrate, consider the following (simplified) example: I establish a GmbH with a share capital of 25,000 euros and invest the money as a fixed deposit at 2% for one year. Otherwise, I do nothing. At the end of the year, the GmbH distributes its total profit (after taxes) completely. How much money will remain for me as a shareholder net?
Dear inquirer,
Thank you for your request, which I am happy to answer in the context of an initial consultation considering your input.
Please note that the tax assessment is based on the information provided.
For your understanding, let me briefly explain the nature of capital gains tax. It is not a separate tax, but rather a special type of withholding tax. The income tax that applies to the income subject to capital gains tax is essentially withheld in advance by the payer (in your case, the bank). In the process of filing your income tax return, the withheld capital gains tax is offset against the income tax liability. So, you are not paying taxes multiple times.
In your example, the following tax payments apply to you:
At the GmbH level, €500 is subject to taxation. With a corporate tax rate of 15%, a trade tax rate of 15%, and a solidarity surcharge of 5.5%, the tax burden at this level amounts to €154.13. The commercial profit of the GmbH is therefore €345.88. If this amount is distributed in full to the shareholder, another 25% capital gains tax is due (ignoring the option for partial income procedure). So, you are left with €259.41. If you had received the interest directly without involving the GmbH, you would have been left with €375.
Using a GmbH as a shell for asset management is generally not advisable, as it results in double taxation. You only avoid a tax disadvantage when the income at the GmbH level is tax-free. This is the case when the income comes from investments in other corporations (e.g. dividends from stocks or capital gains), § 8b KStG. If you also have a long-term investment horizon, you can avoid taxation on gains from asset reshuffling. The taxation only occurs when the earned profits are distributed.
I hope this gives you an initial overview of the legal situation.
Best regards,
Oliver Burchardt
Tax consultant
