Are there ways to minimize corporate tax?
May 3, 2024 | 40,00 EUR | answered by Mia Köhler
Dear tax consultant,
my name is Irmgard Eiserfelder and I am the managing director of a medium-sized GmbH. In recent years, we have achieved good profits, which of course makes us very happy. However, we are now faced with the question of how we can minimize corporate tax in order to reduce our tax burden.
Currently, we are paying a considerable amount of corporate tax, which is eating up a significant portion of our profits. Since we want to further develop and invest in our company, it would be very helpful if we could find ways to reduce the corporate tax burden.
We have already considered various tax optimization measures, such as using loss carryforwards, forming reserves, or choosing a more favorable method of profit determination. Nevertheless, we are unsure if we have exhausted all possibilities and if there are any other strategies to minimize corporate tax.
Therefore, my specific question to you as an experienced tax consultant is: Are there any other ways to reduce corporate tax that we have not considered yet? What tax planning options could be useful for us as a GmbH to optimize our tax burden?
Thank you in advance for your support and advice.
Sincerely,
Irmgard Eiserfelder
Dear Mrs. Eiserfelder,
Thank you for your inquiry regarding the optimization of your corporation tax burden. As the managing director of a medium-sized GmbH, it is understandable that you are striving to minimize your tax burden in order to further develop and invest in your company.
First of all, it is commendable that you have already considered various tax optimization measures. The utilization of loss carryforwards, the formation of reserves, and the choice of a more favorable method of determining profits are indeed important tools for reducing corporation tax. However, there may be additional strategies that you are not yet aware of.
One way to reduce the corporation tax burden could be to incorporate tax-reducing measures into your company. For example, investments in research and development or environmentally friendly technologies could bring tax benefits, such as the utilization of tax incentives or depreciation.
Furthermore, tax-optimized financing structures could also help minimize corporation tax. By choosing the right financing instruments and sources, you can effectively reduce your tax burden. It is advisable to seek advice from an experienced tax advisor to develop financing strategies tailored to your company.
Another possibility for tax optimization could be the use of tax-efficient legal forms or corporate structures. By establishing subsidiaries domestically or abroad or converting to a tax-optimized legal form, you can effectively lower your corporation tax burden.
In summary, there are various ways to reduce corporation tax beyond the measures you have already mentioned. It is advisable to seek advice from an experienced tax advisor to develop tax optimization strategies tailored to your company.
I hope this information is helpful to you and I am available to answer any further questions you may have.
Kind regards,
Mia Köhler
