What happens if I do not pay the trade tax on time?
January 2, 2023 | 30,00 EUR | answered by Eva Heuser
Dear tax advisor,
My name is Laura Ehrig and I run a small business in the event planning industry. In recent months, we have experienced a decline in sales and financial challenges due to the current situation. Now, we are approaching the deadline for the trade tax and I am concerned about what will happen if I am unable to pay it on time.
The current situation is that I currently do not have enough liquid assets to pay the trade tax on time. My main focus right now is on keeping my business running and paying my employees. However, I fear that there may be consequences if I do not pay the trade tax on time.
My concerns are that we may face sanctions or penalties that would further worsen the already difficult financial situation of my company. I want to avoid the problems escalating due to unpaid taxes.
Therefore, my question to you is: What happens if I do not pay the trade tax on time? Are there options to request an extension or installment plan to improve my liquidity situation? What steps should I take to prevent potential consequences and how can I protect my business from financial difficulties?
Thank you in advance for your support and advice.
Sincerely,
Laura Ehrig
Dear Mrs. Ehrig,
thank you for your inquiry regarding trade tax and your current financial situation. It is understandable that you are concerned, especially considering the decrease in turnover your company has experienced in recent months. I would like to help answer your questions and show you possible solutions.
If you do not pay the trade tax on time, this can indeed have consequences. Firstly, late payment interest will be due, which can be quite high depending on the amount of tax owed. In addition, the tax office may also charge late payment fees and possibly even surcharges. These additional costs can further burden your company financially.
To avoid such consequences, it is advisable to contact the tax office early on. You can request an extension of the payment deadline or installment payment. In many cases, tax offices are understanding and willing to make individual payment arrangements, especially if they are informed about the financial difficulties your company is facing.
It is important that you have all relevant documents ready and transparently present your current financial situation to the tax office. Show that you are trying to repay the tax debt, but simply do not have sufficient funds at the moment. Open communication and cooperation with the tax office are crucial in finding possible solutions.
Furthermore, it is advisable to analyze your financial situation and take measures to improve your liquidity. Consider whether you can take out short-term loans to pay the trade tax, or if there are ways to reduce costs or explore new sources of income.
In summary, it is important to take proactive steps to avoid potential consequences of not paying trade tax on time. Initiate a dialogue with the tax office, consider all possible payment arrangements, and think about how you can improve your financial situation in the long term.
I hope this information is helpful to you and I am available if you have any further questions.
Sincerely,
Eva Heuser
