(2023)
Who is required to complete Form G (Income from Business Operations)?
A business according to § 15 EStG exists if you engage in an activity independently (i.e. at your own expense and responsibility), sustainably (i.e. not a one-off action) and with the intention of making a profit (i.e. not a hobby) and participate in general economic transactions (i.e. appear externally). However, these conditions also apply in the same way to freelance work according to § 18 EStG (H 15.6 EStR).
Businesses include
- Craft and industrial enterprises,
- Trading businesses,
- Brokerage activities (e.g. insurance agents, brokers or commercial agents),
- Catering businesses,
- Service companies.
- Corporations such as public limited companies (AG) and limited liability companies (GmbH) are businesses by virtue of their legal form (§ 2 Abs. 2 GewStG).
Income from business also includes
- Profit shares from participation in a partnership (oHG, KG or commercial GbR).
- Income from the sale of a business, part of a business or a share in a business (§ 16 EStG).
- Profits from the sale of a share in a corporation if this amounts to at least 1% of the share capital (§ 17 EStG). This also applies to private investors. Since 2009, the partial income procedure applies, i.e. 60% of the capital gain is taxable and 40% is tax-free (§ 3 Nr. 40 Buchst. c EStG). For shares acquired before 2009, the half-income procedure with its half taxation still applies.
For a shareholding of less than 1% of the share capital, the capital gain is fully taxable as capital income from 2009, regardless of the holding period, and is subject to the withholding tax of 25%. However, this only applies to shares acquired from 2009 onwards (§ 20 Abs. 2 Nr. 1 EStG). For acquisitions before 2009, the previous legal situation still applies, according to which a capital gain is tax-free after a holding period of 12 months. Distributions are subject to withholding tax in both cases from 2009.
- Income from the sale of more than 3 properties within 5 years. In this case, the tax office assumes commercial property trading - regardless of the 10-year period. If up to three properties are sold, the capital gains are usually only taxable within the so-called speculation period of 10 years, as "other income".
- Income from the rental of holiday homes if the type of rental is comparable to a commercial accommodation business. Otherwise, it is "income from renting and leasing".
- Professional guardians according to §§ 1896 ff. BGB have not generated income from business since 2010, contrary to previous opinion, but from "other self-employed work" according to § 18 Abs. 1 Nr. 3 EStG (BFH rulings of 15.6.2010, BStBl. 2010 II p. 906 and 909).
