SteuerGo FAQs

What options do I have with the small business regulation?

Option for the small business regulation

You can opt for the small business regulation under § 19 para. 1 UStG if your gross turnover in the previous year did not exceed 22,000 Euro and is not expected to exceed 50,000 Euro in the current year. If you choose this regulation, the following conditions apply:

• No VAT may be shown separately on your invoices.
• No VAT is to be paid to the tax office.
• The VAT shown on incoming invoices cannot be claimed as input tax.
• For invoices up to 250 Euro, the VAT rate must not be stated.

Important note: An unauthorised statement of VAT obliges you to pay it to the tax office. The recipient of the invoice may not deduct this tax as input tax.

Option for standard taxation

Alternatively, you can waive the small business regulation and opt for standard taxation to use the input tax deduction. This waiver is binding for five years. Then enter your turnover, VAT received, input tax paid, and VAT paid in the „Form EÜR“.

Waiving the small business regulation is advantageous if:

• You plan larger investments or have high material costs (e.g. in the start-up year). In this case, you can deduct the VAT on incoming invoices.
• You mainly provide services to companies, as they consider VAT a pass-through item and are not burdened by higher costs.

Formal obligations for small businesses

Small businesses must also include the tax number or VAT identification number and a consecutive invoice number on their invoices.

Changes from 2024

From the 2024 tax period, the obligation to submit an annual VAT return will be waived unless explicitly requested by the tax office. This exemption only applies to small businesses that have not opted for standard taxation. The waiver of the small business regulation can now be declared up to two years after the relevant tax year.

Increase in turnover limits from 2025

From 2025, the turnover limits for the small business regulation will be increased:

• The previous year's turnover may not exceed 25,000 Euro.
• The current year's turnover is not expected to exceed 100,000 Euro.

These new limits apply retroactively from 2024. However, the Bundesrat must still approve the planned change.

Reverse charge mechanism under § 13b UStG

For certain industries, such as construction, the reverse charge mechanism applies. Here, the tax liability is transferred to the recipient of the service. This particularly affects work supplies and construction services.

• If you are a building contractor or tradesperson receiving construction services, you pay the VAT directly to the tax office and not to the service provider. Therefore, they do not charge you VAT (§ 13b para. 1 no. 4 UStG).

Special features for small businesses under § 19 UStG

• Service recipient (construction services): If you work as a tradesperson and receive construction services, you must pay the VAT for these services to the tax office, even if they are for your private residence (§ 13b para. 5 UStG). In this case, enter the VAT in your tax return.
• Service provider: If you provide construction services yourself, no VAT is due for the recipient of your service (§ 13b para. 2 sentence 4 UStG).