4 ms·

I wouldn't say it is false, I was just simplifying. If you take no outside money (yet), have no employees (yet), and don't buy many goods, you don't really hav

I wouldn't say it is false, I was just simplifying. If you take no outside money (yet), have no employees (yet), and don't buy many goods, you don't really have any benefit of either not paying VAT, or getting limited liability. This is for people who have a side-business of "making websites". You can register a simple business ("Gewerbe") when you have to write an invoice, or start making regular income. Of course, if there is real capital investment involved, or once this is not just a side business, you have to do more.

Xylakant 9y ago
No, it's false, it's actually dangerously false since you personally may be liable for the VAT not paid. The limit is actually a hard limit and it gets more and more dangerous the closer you creep to the edge. At the years turnover, when you write the next years first invoices, you need to know your tax status and you don't have at that time the previous years tax declaration. The tax authorities will not notify you of that change in status. If it turns out you had a total (vat)-taxable income of 17499 EUR, you're fine. If you miscalculated and had 17501 € and mistakenly already wrote your invoices thinking you'd be VAT-free then there's two options: if your customer is a company, you can correct the invoice and have them pay the VAT (their accounting department will absolutely love that if you come back half a year later on a paid invoice, trust me). If the customer is a private person, you get to pay the VAT. I've seen people fall in that trap and I can tell you, re-writing all your invoices for a year sucks, paying 20% of your income as VAT because you simplified the rules sucks even more. You also need to file the registration with the tax authorities before you write your first invoice (you need a tax number for a correct invoice). As a general rule of thumb: You don't simplify when it comes to taxes. (Side note: This is still unrelated to registering a company or even registering with the Gewerbeamt which may or may not be required depending on what exactly you do. Members of the Freie Berufe for example don't need that.)

Xylakant 9y ago

No, it's false, it's actually dangerously false since you personally may be liable for the VAT not paid. The limit is actually a hard limit and it gets more and more dangerous the closer you creep to the edge. At the years turnover, when you write the next years first invoices, you need to know your tax status and you don't have at that time the previous years tax declaration. The tax authorities will not notify you of that change in status. If it turns out you had a total (vat)-taxable income of 17499 EUR, you're fine. If you miscalculated and had 17501 € and mistakenly already wrote your invoices thinking you'd be VAT-free then there's two options: if your customer is a company, you can correct the invoice and have them pay the VAT (their accounting department will absolutely love that if you come back half a year later on a paid invoice, trust me). If the customer is a private person, you get to pay the VAT. I've seen people fall in that trap and I can tell you, re-writing all your invoices for a year sucks, paying 20% of your income as VAT because you simplified the rules sucks even more. You also need to file the registration with the tax authorities before you write your first invoice (you need a tax number for a correct invoice). As a general rule of thumb: You don't simplify when it comes to taxes. (Side note: This is still unrelated to registering a company or even registering with the Gewerbeamt which may or may not be required depending on what exactly you do. Members of the Freie Berufe for example don't need that.)