Giving away a photovoltaic system to a toddler.
July 29, 2019 | 50,00 EUR | answered by Steuerberater Knut Christiansen
Donation of a paid-off photovoltaic system (annual profit approx. 5000 euros) from grandfather to minor grandchild. Is this possible? Can the 2-year-old child act as a small business owner towards the tax office? Does a separate tax return need to be prepared for the child?
Good day,
in principle, it would be possible, however, since your grandson is a minor, the guardianship court would need to be involved. There may be some restrictions in this case.
Otherwise, the investment could be transferred at book value. The small business regulation would also be possible if the annual turnover is less than €17,500. However, this should only be claimed if the investment is older than 5 years. Otherwise, a input tax correction according to Paragraph 15a of the VAT Act may be necessary. This would mean that input tax claimed from the purchase may need to be repaid to the tax office.
Your grandson would also need to file a tax return (through the guardian) as he is earning commercial income.
I hope this answers your question, if not, feel free to ask further questions at no cost.
Best regards
Knut Christiansen
Tax advisor
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