Do I as a small business owner also have to pay value added tax?
February 28, 2024 | 40,00 EUR | answered by Günther Hering
Dear tax advisor,
my name is Max Vöss and I have been working as a small business owner for several years. In my company, I sell handmade furniture and generate an annual turnover of less than 22,000 euros. So far, I have not included any value added tax on my products and have not submitted any advance turnover tax returns.
Now I have heard from other small business owners that I may still have to pay value added tax, even though I am considered a small business owner. This information has made me uncertain and I am wondering if I have been acting incorrectly so far and if I may have to pay back taxes.
I would like to know from you whether small business owners like me actually have to pay value added tax and if I have made mistakes in the past by not submitting advance turnover tax returns. If this is the case, what steps would I need to take now to correct my tax situation?
I would be very grateful if you could help me with this question, as I am very worried and need clarity on this matter.
Thank you in advance for your help.
Sincerely,
Max Vöss
Dear Mr. Vöss,
Thank you for your inquiry and your trust in my expertise as a tax advisor in the field of value added tax. It is understandable that you are concerned about your tax situation, especially when it comes to paying value added tax as a small business owner.
As a small business owner, you are classified according to § 19 UStG if your turnover in the previous calendar year did not exceed 22,000 euros and is not expected to exceed 50,000 euros in the current year. In your case, since your turnover is below 22,000 euros, you are indeed classified as a small business owner.
As a small business owner, you are exempt from VAT, which means that you are not allowed to show VAT on your invoices and do not have to submit VAT returns. This applies as long as you are taking advantage of the small business owner regulation.
However, if you have inadvertently shown VAT or submitted VAT returns even though you are classified as a small business owner, you should immediately contact the tax office. Typically, such errors can be corrected by making an adjustment to the VAT return or submitting a zero return.
It is important that you correct your tax situation properly to avoid any tax payments or fines. If you are unsure about what steps to take, I recommend consulting a tax advisor or the tax office to clarify your individual situation.
I hope that this information has been helpful to you and I am available to assist with any further questions.
Best regards,
Günther Hering
