Can I deduct input tax for services provided by freelancers and self-employed individuals?
June 10, 2023 | 30,00 EUR | answered by Roberta Schlattmann
Dear tax advisor,
My name is Claudia Engel and I run a small business that utilizes services from freelancers and self-employed individuals. I am wondering if I can deduct the input tax for these services and what steps I need to take.
Regarding the current situation: My company regularly engages freelancers and self-employed individuals for various tasks, such as graphic design, content creation, or programming. These services are essential for the operation of my business, but the costs add up quickly. I would like to know if I can claim the input tax for these expenses to reduce my tax burden.
My concern is that I may be giving away money by not correctly deducting the input tax. As a businesswoman reliant on making my expenses as efficient as possible, it is important for me to know if and how I can utilize the input tax for services from freelancers and self-employed individuals.
Could you please explain to me if and how I can deduct the input tax for services from freelancers and self-employed individuals? Are there specific regulations or requirements that I need to consider? What documentation do I need to have in order to claim the input tax? I appreciate your expert advice and thank you in advance for your help.
Sincerely,
Claudia Engel
Dear Mrs. Engel,
Thank you for your inquiry regarding the deductibility of input tax for services provided by freelancers and self-employed individuals in your company. As a tax advisor, I am happy to assist you and explain how you can correctly claim input tax.
First of all, it is important to know that as a business owner, you are generally entitled to claim input tax for all business-related expenses. This includes services that you receive from freelancers and self-employed individuals. Input tax is the value added tax that is invoiced to you by your suppliers and that you can reclaim from the tax office when filing your VAT return.
In order to claim input tax for services provided by freelancers and self-employed individuals, you must have appropriate invoices. These invoices must contain specific information, such as the name and address of the supplying company, your own VAT identification number, the date of issue of the invoice, a unique invoice number, the quantity and nature of the service provided, and the amount of VAT. Without this information, you cannot claim input tax.
It is important that you carefully keep and properly record the invoices in your accounting. You should also ensure that the services for which you want to claim input tax are actually used for your business and are business-related. Private expenses cannot be claimed as input tax.
There are no specific rules or requirements that you need to follow in order to claim input tax for services provided by freelancers and self-employed individuals. As long as you have the appropriate invoices and the expenses are business-related, you can claim input tax in your VAT return.
I hope that this information has been helpful to you. If you have any further questions or would like a more detailed consultation, I am at your disposal.
Sincerely,
Roberta Schlattmann
