Binding to value added tax
March 16, 2011 | 20,00 EUR | answered by Oliver Burchardt
Hello,
I started my own business in 2008 and, on the advice of experts, decided not to opt for the small business regulation. I have not been able to get my business in the field of interior design going, but I have also not deregistered it.
Now I have taken on the home care of a family member and could also work independently on a part-time basis for around 500 euros per month in various assignments in my profession as an art educator in institutions. I would now like to return to the small business regulation, but it can only be done after 5 years. Would it be possible to deregister the old business and easily register a new one in the short term in order to obtain small business status? What should I watch out for?
Best regards,
Your inquirer
Dear inquirer,
Thank you for your inquiry, which I am happy to answer as part of an initial consultation.
Please note that the tax assessment is based on the information provided. Changing, adding, or omitting information may significantly affect the outcome.
From a VAT perspective, you are considered an entrepreneur personally. It is irrelevant whether you have made the necessary registrations or deregistrations of business operations according to the trade regulations. The VAT consequences always affect you personally, never your business.
Therefore, by deregistering and re-registering your business, you cannot shorten the binding period to the option you made in 2008.
However, from a tax perspective, this waiver is also not recommended, as you would be giving up the opportunity to deduct input tax. In your current activities, you are likely incurring costs that are subject to VAT. By waiving this, you can reclaim this paid VAT from the tax office.
I hope my explanations have helped you.
Best regards,
Oliver Burchardt
Tax advisor
