How can I as a small business owner benefit from tax advantages when it comes to trade tax?
October 7, 2022 | 40,00 EUR | answered by Eva Heuser
Dear Tax Advisor,
I have been running a small business for several years and have never delved deeply into the topic of trade tax. As my business has been doing well lately, I am thinking about how I, as a small business owner, can benefit from tax advantages when it comes to trade tax.
The current situation is as follows: My revenue has been steadily increasing over the past few years and I have also made some investments to further expand my business. Now I am wondering if there are ways to reduce my trade tax burden and thus achieve more profit for my company.
My concerns stem from the fact that I have little experience with tax matters and do not know exactly what measures I can take to obtain tax advantages when it comes to trade tax. I would like to learn more about possible tax saving opportunities and understand what legal regulations exist that could benefit me as a small business owner.
So my question to you is: How can I, as a small business owner, benefit from tax advantages when it comes to trade tax? What options are available to me to reduce my trade tax burden and thereby financially relieve my company?
I look forward to your expert advice and thank you in advance for your support.
Sincerely,
Friedhelm Eckstein
Dear Mr. Eckstein,
Thank you for your inquiry regarding trade tax and your openness to engage with this important topic. As a tax advisor with many years of experience in the field of trade tax, I am happy to provide you with some helpful information and tips on how you, as a small business owner, can benefit from tax advantages when it comes to trade tax.
First and foremost, it is important to know that trade tax is one of the most important taxes for business owners and is levied on the profit you generate from your self-employment. However, as a small business owner, you have certain tax-free allowances that you can take advantage of to reduce your trade tax burden.
One way to reduce your trade tax burden is to use the tax-free allowance for small business owners. Up to an annual trade income of 24,500 euros (as of 2021), you are exempt from trade tax. So if your profit is below this amount, you do not have to pay trade tax.
Furthermore, through clever tax planning and investments, you can lower your trade tax burden. Investments in your business, such as machinery, vehicles, or real estate, can be tax deductible and therefore reduce the taxable profit.
The choice of legal form for your business can also have an impact on trade tax. Depending on the legal form, there are different regulations and tax-free allowances for trade tax. As a small business owner, you have the option to operate your business as a sole proprietorship, partnership, or limited liability company, each with different tax implications.
It is also advisable to regularly discuss your tax matters with an experienced tax advisor to identify and take advantage of possible tax benefits. A tax advisor can also help you minimize tax risks and develop an optimal tax structure for your business.
In conclusion, there are various ways in which you, as a small business owner, can benefit from tax advantages when it comes to trade tax. It is important to address the topic of trade tax and, if necessary, seek professional help to reduce your trade tax burden and financially support your business.
I hope this information was helpful to you. If you have any further questions, please feel free to contact me.
Best regards,
Eva Heuser
Tax Advisor
