Pay trade tax
Do you run a company (business) in Germany and generate a commercial income of more than EUR 24,500 per year?
Then you are obliged to submit a trade tax return to your tax office. In it, you explain how high your business income was in the past calendar year (survey period). You submit a trade tax return for each collection period in which you operated your business (annually). You must submit the declaration electronically, for example via www. Elster.de. In doing so, you declare further additions or reductions based on your profit or loss (simplified: income minus expenses).
In addition, you indicate in which municipality you operate your business.
The tax office determines the trade tax assessment amount and announces it by notice.
The trade tax assessment amount is determined by the tax office by multiplying the trade income by the tax assessment figure of 3.5 percent. This measurement amount is the basis for the amount of trade tax.
The tax office informs the municipality in which you operate your business about the trade tax assessment amount.
The municipality will send you a notice of the trade tax to be paid by you or reimbursed to you by the municipality.
The municipality calculates the trade tax from the trade tax assessment amount of the tax office multiplied by the trade tax rate of the municipality. Each municipality determines its own rate.
With the trade tax notice, the municipality also decides on the advance payments of trade tax to be paid by you in the future for the subsequent collection period.
You pay the amounts specified in the notice of trade tax and/or advance payments for trade tax to the municipality on the date specified therein.
Process flow
If you operate a commercial enterprise and are subject to trade tax, the following must be done:
- You submit your trade tax return electronically.
- You will receive a notification of the determination of the trade tax assessment amount from your tax office.
- Subsequently, you will receive a notice of assessment of the trade tax from the municipality.
- Finally, you pay (if applicable) trade tax to the municipality.
Requirements
You run a commercial business (not for freelancers and farmers and foresters) and are not exempt from trade tax.
Which documents are required?
Trade tax return, electronically transmitted
What are the fees?
None
Emission: free of charge
What deadlines do I have to pay attention to?
- Non-taxable persons:
Submission of the trade tax return by 31.7. of the calendar year following the collection period
- Tax advisers (e.g. submission of the trade tax return by a tax consultant):
Submission of the trade tax return by 28.2. of the second calendar year following the collection period
- Extended deadlines due to the impact of the coronavirus:
- Non-taxable persons:
Submission of the trade tax return 2020 until 31.10.2021
Submission of the trade tax return 2021 until 31.10.2022
Submission of the trade tax return 2022 until 30.09.2023
- Tax-advised taxpayers (e.g. submission of the trade tax return by a tax consultant):
Submission of the trade tax return 2020 until 31.08.2022
Submission of the trade tax return 2021 until 31.08.2023
Submission of the trade tax return 2022 until 31.07.2024
Processing duration
Different - depending on the work situation.
Legal basis
Trade Tax Act (GewStG)
https://www.gesetze-im-internet.de/gewstg/
Trade Tax Implementation Ordinance (GewStDV)
https://www.gesetze-im-internet.de/gewstdv_1955/index.html
- Trade tax return, obligation to submit electronically § 14a GewStG and § 25 GewStDV
- Income from business operations or business income § 7 GewStG
- Additions § 8 GewStG
- Reductions § 9 GewStG
- Trade tax exemptions § 3 GewStG
- Trade tax assessment amount § 11 GewStG
- Trade tax assessment amount § 14 GewStG
- Trade tax, levy rate § 16 GewStG
Appeal
Trade tax assessment notice (as a basic assessment for the trade tax assessment notice of the municipality):
- Objection to the tax office
- Action before the Tax Court
What else should I know?
You can find a summary of the levy rates of the municipalities on the website of the Federal Statistical Office
https://www.destatis.de/DE/Themen/Staat/Steuern/Steuereinnahmen/_inhalt.html#sprg236424
or on the website of the municipality in which you operate your business.
- Trade tax return form GewSt 1A on the ELSTER website
https://www.elster.de/eportal/formulare-leistungen/alleformulare/gewst
Technically approved by
State Tax Office of Lower Saxony
Author
The text was automatically translated based on the German content.
