Small business - legal form
March 20, 2011 | 30,00 EUR | answered by Dipl.BW/SB Ulrich Stiller
Dear Sir or Madam,
I would like to register the sale of wooden figures as a side business at the trade office (starting small...).
Planned turnover per year approximately 9000 euros. I wanted to choose the legal form of a sole proprietor for small business owners.
Am I considered a merchant through the sale of wooden figures? Do I have to register my business in the commercial register?
I pay VAT when purchasing goods.
However, I am not allowed to charge sales tax when selling?
What information or documents regarding my expenses, turnover do I have to submit to the tax office each year?
Thank you for the information.
Sincerely,
Dear advice seeker,
Thank you for your inquiry, which I would like to answer based on your information and in the context of your efforts in the context of an initial consultation as follows:
You only need to register your business with your municipality. There is no need to register with the commercial register.
In your case, the statutory small business regulation of § 19 UStG applies. Your income is not subject to sales tax, so you also do not have input tax deduction. However, you can also waive the exemption from sales tax by opting for standard taxation, but then you are bound to standard taxation for 5 years. You must then calculate the sales tax from your income and can deduct input tax, provided the conditions for a proper invoice are met.
The input tax invoiced to you as a small business owner is a normal operating expense.
You must submit an income tax return, income-expenditure statement, and sales tax return to the tax office by May 31 of the following year (this deadline can be extended by request). A trade tax return does not need to be submitted if the profit is less than 24,500 euros. In the sales tax return, you only need to check the small business regulation on page 1.
In the income-expenditure statement, you determine the profit or loss by comparing the business income with the business expenses and enter this in Annex G to the income tax return. As a small business owner, you do not have to fill out the official EÜR form, the informal profit determination I mentioned is sufficient.
I hope I could be of assistance to you.
Best regards,
Ulrich Stiller
Tax consultant / Diplom-Business Administrator
