How long do I have to pay back trade tax if my company becomes insolvent?
November 26, 2023 | 40,00 EUR | answered by Isabel Möller
Dear Tax Advisor,
My name is Erwin Völker and I have been running a small IT services company for the past five years. Unfortunately, due to financial difficulties, I recently had to file for insolvency. Now I am concerned about how long I will have to repay trade tax, as I fear this could further worsen my financial situation.
My company has been paying trade tax in the past years, but due to declining revenues and increasing costs in recent months, I have been unable to pay trade tax. I am worried about whether I will now have to retroactively pay trade tax for previous years and how long these payments could extend for.
I am facing the challenge of resolving my financial situation and I want to avoid worsening my insolvency through the repayment of trade tax. Therefore, it is important for me to know what options and solutions are available to best manage the situation and how long the repayment of trade tax could take in my case.
I would greatly appreciate your professional assessment and advice on this matter in order to plan my next steps.
Sincerely,
Erwin Völker
Dear Mr. Völker,
Thank you for your inquiry regarding the repayment of trade tax after your insolvency. It is understandable that you are concerned about how long and to what extent you may have to repay trade tax and what impact this could have on your financial situation.
In principle, trade tax must be paid for the current year and the past years in which profits were made. Since your company has paid trade tax in recent years, it is possible that you may have to repay trade tax retroactively for those years. However, this depends on various factors, such as the actual profits earned and the taxes already paid.
In the case of insolvency, it may be possible to defer or waive the repayment of trade tax. It is important that you provide all relevant documents and information about your insolvency and your company to the tax office in order to obtain a suitable arrangement.
It is advisable to contact a tax advisor early on to discuss your individual situation and work out possible solutions. An experienced tax advisor can assist you in structuring the repayment of trade tax in the best possible way and stabilizing your financial situation.
Regarding the duration of the repayment of trade tax, it is difficult to make an exact prognosis as this depends on various factors. It may be that the repayment is spread out over a longer period to reduce your financial burden. Again, a tax advisor can provide you with helpful tips and recommendations.
I therefore recommend that you schedule a meeting with a tax advisor promptly to discuss your situation and develop a strategy together for the repayment of trade tax. I am available for a personal consultation and am here to assist you in overcoming this challenge.
Sincerely,
Isabel Möller
Tax Advisor
