How can I optimize the trade tax burden for my company?
March 30, 2024 | 40,00 EUR | answered by Simon Schaaf
Dear tax advisor,
I am Lorenzo Weidmannsdorf, owner of a medium-sized company operating in the automotive industry. In recent years, we have consistently generated profits and have been steadily growing. However, I have noticed that our business tax burden has significantly increased in recent years and is consuming a significant portion of our profits.
The current situation is that we have to pay a high amount of business tax every year, which heavily affects our liquidity and limits our investment opportunities. I am concerned that the high business tax burden could affect our competitiveness in the long run.
Therefore, my question to you as a tax advisor is: How can I optimize the business tax burden for my company? Are there legal ways to reduce the tax burden without violating tax laws? What tax planning opportunities are available to minimize our business tax payments and improve our liquidity?
I would greatly appreciate your professional advice and specific suggestions on how we can optimize the business tax burden for our company in order to remain successful in the market in the long term.
Thank you in advance for your support.
Sincerely,
Lorenzo Weidmannsdorf
Dear Mr. Weidmannsdorf,
thank you for your inquiry regarding the optimization of your trade tax burden. As a tax advisor specializing in trade tax consulting, I can show you some ways to reduce the tax burden for your company without violating applicable tax law.
First of all, it is important to understand that trade tax is a local tax levied by municipalities. The amount of trade tax depends on the trade income of your company, the trade tax rate of the respective municipality, and the trade tax exemption.
One approach to reducing the trade tax burden could be to optimize the trade income. For example, business measures such as reducing costs, increasing turnover, or optimizing business processes can help. By efficient business management and targeted profit maximization, you can increase your trade income and thus reduce the trade tax burden.
There are also tax planning options to minimize trade tax payments, such as creating reserves, using loss carryforwards, or structuring equity efficiently. By clever tax planning, you can optimize your trade tax burden and improve your liquidity.
Another important point is the choice of location for your company. Depending on the municipality, the trade tax rate may vary. By conducting a location analysis and possibly relocating the company to a municipality with a lower trade tax rate, you can reduce your trade tax burden.
Finally, it is advisable to regularly consult with a tax advisor to identify and take advantage of tax optimization opportunities early on. Through professional advice, you can successfully compete in the market long-term and strengthen your competitiveness.
I hope these suggestions are helpful to you and I am available for further questions or detailed consultation.
Best regards,
Simon Schaaf, Tax Advisor
