Investment deduction amount
January 30, 2020 | 35,00 EUR | answered by Steuerberater Knut Christiansen
Dear Sir or Madam,
I am self-employed and in 2018 I was still covered by my wife's health insurance without having to pay contributions. Now I am preparing the income tax declaration for 2018. My commercial income exceeds the income limit of 5,220,- p.a. by approximately 13,000,-. I have now become aware of the investment allowance. Since I have been investing more in machinery and similar items since 2019 anyway, this solution seems very sensible to me.
I believe that the necessary requirements are met in my case. However, I am unsure because I read that "the deduction is made outside the profit and loss statement". Furthermore, I could not definitively determine whether the investment allowance can be split among various investments. I intend to declare investments of 35,000,- / investment allowance of 14,000,- in the income tax declaration for 2018, and offset them against various business investments in the years 2019-2021.
Is my approach correct or promising?
Yours sincerely,
Chr. Breu
Hello and thank you for using frag-einen.com!
I would like to answer your question as follows within the scope of an initial consultation.
You can consider the IAB off-balance sheet. Assuming you are preparing an EÜR, enter the amount of 14,000 EUR in line 101 of the EÜR attachment. Your profit will then be reduced by 14,000 EUR, so that your income in the 2018 income tax assessment will be correspondingly lower. This would fulfill the requirements for family insurance. You do not have to specify the investment goods specifically. This means that you can initially use a lump sum investment amount of 35,000 EUR, which should then lead to investments in the years 2019-2021. It is therefore possible to divide it into multiple goods without any issues.
I hope this answers your question, otherwise feel free to ask further questions at no cost.
I would like to point out that this forum cannot replace a comprehensive and personal tax consultation, but is mainly intended to enable an initial tax assessment. By adding or omitting relevant information, the legal assessment of your issue could be different.
Best regards
Knut Christiansen
Tax consultant
