Tax planning for the self-employed in Germany (Steueroptimierung)

The statutory rules behind the usual ways a self-employed person in Germany lowers income tax, trade tax, VAT and social contributions: for each idea the rule, its conditions, its limit and what stops it. This Guide never computes a saving and does not rank options. Figures are for tax year 2026, from the federal law pages, the ministry instructions for the 2026 EÜR form (ministry letter of 1 September 2026) and 2026 pension insurer pages. One source is dated another year: the ministry booklet "Steuern von A bis Z" is the 2025 edition, used only for the marginal income tax rates, the church tax rates and the lowest trade tax multiplier, because the statute prints those as factors, not at all, or already in its 2027 version. Rates set for later years are marked as not for 2026.

Germany Tax Optimization: Self-Employed Guide

Read the conditions before the benefit. Several rules only move tax to a later year: the investment deduction is added back when the asset is bought, faster depreciation leaves less for later years, and retained profit is taxed again when withdrawn.

Section 1: Quick Reference

Quick Reference

Field	Value
Who this covers	Traders, liberal professions (§ 18 EStG), partners, owner-managers of a small GmbH
Key legislation	EStG § 4, § 6, § 7, § 7g, § 9, § 10, § 10d, § 34a, § 35; KStG § 1a, § 23; GewStG § 11, § 16; UStG § 15, § 19, § 20; AO § 42
Anti-abuse rule	§ 42 AO disregards an inappropriate arrangement giving a tax advantage the law does not provide for, unless non-tax reasons that matter overall are proven
Currency, tax year	EUR; the calendar year (§ 2(7) EStG)
Filing deadline	31 July 2027 for 2026; with an adviser, end of February 2028, which the tax office can shorten (§ 149 AO)

Pages: https://www.gesetze-im-internet.de/ao_1977/__42.html and https://www.gesetze-im-internet.de/ao_1977/__149.html

Income Tax Rates 2026

The tariff is a formula (§ 32a(1) EStG): the statute prints zone boundaries for a single assessment, the flat zones as the factors 0,42 and 0,45, and no percentage for the progressive zones.

Income tax tariff 2026: zone boundaries

Zone	Taxable income, single assessment	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__32a.html
Basic allowance, no tax	up to EUR 12,348	"bis 12 348 Euro"
First progressive zone	EUR 12,349 to EUR 17,799	"von 12 349 Euro bis 17 799 Euro"
Second progressive zone	EUR 17,800 to EUR 69,878	"von 17 800 Euro bis 69 878 Euro"
First flat zone, factor 0,42	EUR 69,879 to EUR 277,825	"von 69 879 Euro bis 277 825 Euro"
Highest zone, factor 0,45	from EUR 277,826	"von 277 826 Euro an"

Marginal rates, church tax, lowest trade tax multiplier (ministry booklet, 2025 edition)

What	Value	Note
Source	all figures below	https://www.bundesfinanzministerium.de/Content/DE/Downloads/Broschueren_Bestellservice/steuern-von-a-z.pdf?__blob=publicationFile&v=9
Lowest marginal rate	14%	"Zonen von 14 Pro- zent"
Top marginal rate, first flat zone	42%	"auf 42 Prozent (Spitzensteuersatz)"
Highest marginal rate	45%	"auf dann 45 Prozent (Reichensteuer)"
Church tax for members, on the tax	8% or 9%	"8 oder 9 Prozent"
Lowest trade tax multiplier, the 2026 rule	200%	"mindestens 200 Prozent"

Rates on the next euro, not on all income. The booklet's zone boundaries are the 2025 ones: use the statute table.

Solidaritätszuschlag: the rate

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/solzg_1995/__4.html
Surcharge on the tax, not on income	5.5%	"beträgt 5,5 Prozent"

Solidaritätszuschlag: exemption limits 2026

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/solzg_1995/__3.html
Single assessment: charged only above	EUR 20,350	"anderen Fällen 20 350 Euro"
Joint assessment and other splitting cases	EUR 40,700	"Einkommensteuergesetzes 40 700 Euro"

The limit is measured on the assessed income tax and has a mitigation zone above it: not an allowance. § 3(3) SolzG names persons liable to income tax, so a GmbH has no exemption limit. No official page prints a combined rate of income tax, surcharge and church tax, so this Guide states none.

Section 2: Income Splitting & Structuring

Ehegattensplitting (Spousal Income Splitting)

Ehegattensplitting table

Strategy	Rule and what limits it
Joint assessment, § 26, § 26b, § 32a(5) EStG	Both fully liable to German income tax and not living permanently apart. Tax is twice the tax on half the joint income. No saving is printed anywhere: work the formula both ways
Tax classes, § 38b EStG	Only for wage tax on a salary; they set withholding, not the year's tax. No tax class on self-employed income

Sole Proprietorship vs GmbH

No official page prints a combined rate for either form, a profit level for incorporating, or a ranking. Do not add the parts below into one rate.

Sole Proprietorship vs GmbH table

Factor	Einzelunternehmen or partnership	GmbH
Who is taxed	The owner, at the tariff, when the profit arises	The company (§ 1(1) no. 1 KStG)
Trade tax	Only a trade; § 18 EStG professions are not. Allowance below, § 35 EStG credit	Always (§ 2(2) GewStG); no allowance, no credit
The owner's pay	A withdrawal, not an expense	A salary is an expense; a hidden profit distribution is not (§ 8(3) KStG)
Profit taken out	No second tax	A dividend: flat tax, or the partial-income method
Losses	Against the owner's other income	At company level only (§ 8(1) KStG)
Accounts, formation	EÜR if no bookkeeping duty: germany-bookkeeping	germany-formation

Corporate tax rate (§ 23 KStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/kstg_1977/__23.html
Tax year 2026; printed for periods up to 2027	15%	"bis 2027 15 Prozent"

§ 23(1) KStG also prints lower rates for the assessment periods 2028 to 2032. None applies to 2026. Surcharge and trade tax come on top.

Trade tax: allowance and base rate (§ 11 GewStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/gewstg/__11.html
Allowance for natural persons and partnerships, per business per year; not a cliff	EUR 24,500	"Freibetrag in Höhe von 24 500 Euro"
Base rate after the allowance; the municipality's multiplier applies to the result	3.5%	"Gewerbeertrag beträgt 3,5 Prozent"

Trade tax: lowest multiplier from 2027, not for 2026

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/gewstg/__16.html
On the page, but § 36(5b) GewStG starts it in 2027; for 2026 see Section 1	280%	"Er beträgt 280 Prozent"

• Trade tax credit (§ 35 EStG). Income tax falls by four times the trade tax base amount ("das Vierfache"), capped at the trade tax payable and at the income tax on the trade income. Not for a GmbH. https://www.gesetze-im-internet.de/estg/__35.html

Retained profit of a sole trader or partner (§ 34a EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__34a.html
On application, for profit not withdrawn, periods up to 2027; the lower later rates there are not for 2026	28.25%	"28,25 Prozent für Veranlagungszeiträume bis 2027"
Tax on the follow-up amount when it is withdrawn later	25%	"Nachversteuerungsbetrag beträgt 25 Prozent"
A partner may apply only where one of the next two tests is met: the share of the profit is more than this share	10%	"wenn sein Anteil am ... Gewinn mehr als 10 Prozent beträgt"
Or the share of the profit is above this amount	EUR 10,000	"oder 10 000 Euro übersteigt"

• Conditions. Balance-sheet profit only, so not for an EÜR business; applied for per business or partner share and per year. Withdrawals above the year's profit plus deposits trigger the follow-up tax: it defers tax, it does not remove it. Not available for profit on which the § 16(4) EStG allowance or the § 34(3) EStG reduced rate is claimed.

Dividends: flat tax and the option out (§ 32d EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__32d.html
Flat tax on private investment income	25%	"beträgt 25 Prozent"
On application it does not apply where the shareholder holds at least	25%	"mindestens 25 Prozent an der Kapitalgesellschaft"
Or holds this AND, through professional work for the company, can take significant entrepreneurial influence on its business	1%	"zu mindestens 1 Prozent an der Kapitalgesellschaft beteiligt ist und durch eine berufliche Tätigkeit für diese maßgeblichen unternehmerischen Einfluss auf deren wirtschaftliche Tätigkeit nehmen kann"

The dividends then go to the tariff under the partial-income method, related costs become deductible in part (§ 3c(2) EStG) and the saver's allowance stops applying. Applied for with the return; it covers four following years and cannot be renewed once withdrawn.

Partial-income method: the tax-free share (§ 3 EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__3.html
Share of the dividend or sale price that is tax-free	40%	§ 3 no. 40: "40 Prozent"

• § 1a KStG option. A commercial or registered civil-law partnership, not a sole trader, may be taxed like a corporation. It cannot be revoked, is filed a month before the business year, and ends the EÜR and the § 35 EStG credit. https://www.gesetze-im-internet.de/kstg_1977/__1a.html

Employing Family Members (Ehegatten-Arbeitsverhältnis)

• Pay for work really done is an expense (§ 4(4) EStG); household costs and maintenance are not (§ 12 EStG). The arm's-length tests (written contract, payment to the family member's own account, duties matching the pay) come from court rulings, not a linkable page: unverified practice. For a spouse or descendant the collecting agency must ask the pension insurer for a status decision (§ 7a SGB IV). Payroll and the Minijob limit: de-payroll. https://www.gesetze-im-internet.de/estg/__12.html

Section 3: Deductions Most People Miss

The base rule is § 4(4) EStG: expenses caused by the business. § 4(5) EStG limits some and points to § 9 EStG. Gifts, entertainment, the home office room and lifestyle-related costs must be recorded singly and apart, or they are lost entirely (§ 4(7) EStG). For mixed costs only the business share counts.

Deductions Most People Miss table

Deduction	Rule, condition and limit
Home working day rate	§ 4(5) no. 6c: the rate below per day worked mainly at home, up to the yearly cap
Home office room	§ 4(5) no. 6b: only where the room is the centre of all activity; else the day rate
Commuting allowance	§ 4(5) no. 6 EStG, which applies § 9(1) sentence 3 no. 4 to the owner's trips between home and the business premises: one rate from the first kilometre in 2026, one way, per day at the premises
Business trips by car	A PRIVATE car used for the business: the share of the actual costs, or the flat rate per full kilometre below. A car that is a business asset already has its costs as expenses; private use is the § 6(1) no. 4 table in Section 4
Travel expenses	§ 9(4a): meal amounts below, in Germany, first three months at one place
Double household	§ 9(1) no. 5: accommodation up to the cap below, one trip home a week
Professional development	Courses, books, journals caused by the business; a first degree only after a first training
Work equipment	Laptop, desk, chair, phone; write-off speed in Section 4; private use excluded
Telephone and internet	Business share only; no official page prints an undocumented flat share
Dues, insurance, relocation	Kammer dues, business cover, a job-caused move (flat amounts by ministry letter)
Gifts to business contacts	§ 4(5) no. 1: the limit below per recipient per year, a cliff, not for own staff
Business entertainment	§ 4(5) no. 2: the share below, with place, date, participants and reason recorded
Car used privately too	§ 6(1) no. 4 EStG: the table in Section 4
Private items	Childcare, own training, insurance, donations below; household services: § 35a EStG

Limits in § 4 EStG

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__4.html
Home working day rate per calendar day	EUR 6	"Betrag von 6 Euro (Tagespauschale)"
Yearly cap on the day rates, per person	EUR 1,260	"höchstens 1 260 Euro"
Yearly flat amount for a home office room that is the centre of all activity	EUR 1,260	"pauschal ein Betrag von 1 260 Euro"
Gifts: all items to one recipient in the year	EUR 50	"insgesamt 50 Euro nicht übersteigen"
Entertainment: deductible share of reasonable costs	70%	"sie 70 Prozent der Aufwendungen übersteigen"
Business car, home-to-premises trips: the non-deductible amount is the positive DIFFERENCE between this share of the German list price per month per distance kilometre and the commuting allowance, not this share itself	0.03%	"in Höhe des positiven Unterschiedsbetrags zwischen 0,03 Prozent des inländischen Listenpreises ... und dem sich nach § 9 Absatz 1 Satz 3 Nummer 4 ... ergebenden Betrag"

Limits in § 9 EStG

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__9.html
Commuting allowance 2026 per full kilometre one way	EUR 0.38	"von 0,38 Euro anzusetzen"
Yearly cap on it	EUR 4,500	"höchstens jedoch 4 500 Euro"
Second household: accommodation per month, in Germany	EUR 1,000	"höchstens 1 000 Euro im Monat"
Meals: calendar day with 24 hours away	EUR 28	"28 Euro für jeden Kalendertag"
Meals: arrival and departure day, and a day over eight hours	EUR 14	"jeweils 14 Euro für den An- und Abreisetag"

Business trips in a private car (ministry instructions for the 2026 EÜR form)

What	Value	Note
Source	all figures below	https://www.bundesfinanzministerium.de/Content/DE/Downloads/BMF_Schreiben/Steuerarten/Einkommensteuer/2026-09-01-anlage-EUER-2026.pdf?__blob=publicationFile&v=2
Private car used for the business: flat amount per full kilometre, in place of the share of actual costs	EUR 0.30	"pauschal mit 0,30 Euro für jeden vollen km"

Private deductions a self-employed person can also claim (§ 10 EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__10.html
Childcare for a child of the household under 14, with an invoice and bank payment	80%	"80 Prozent der Aufwendungen"
Childcare: yearly cap, per child	EUR 4,800	"höchstens 4 800 Euro je Kind"

Section 4: Capital Allowances Optimization

Investitionsabzugsbetrag (IAB): § 7g EStG

IAB table

Feature	Detail
What and who	The share below of the expected cost of a future movable fixed asset, deducted before the purchase. The profit before the deduction must be within the profit limit below: a cliff
Limit, timeline	Open deductions stay under the total cap below, per business; the asset must be bought by the end of the third business year after the deduction
Business use	Let, or used only or almost only for the business in a GERMAN permanent establishment, to the end of the business year after the purchase. A car with more private use fails
On purchase	Up to the share below of the ACTUAL cost is added back, never more than the deduction still open, and the same amount may then be taken off the asset's cost, so depreciation runs on less. If the asset costs less than expected, the part left over is reversed under § 7g(3). Brought forward, not extra
If the plan fails	Reversed in the year claimed, even in a final assessment, with interest under § 233a AO from the normal start
Losses	It may create or increase a loss

Investment deduction and special depreciation (§ 7g EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__7g.html
Share of the expected cost deductible in advance	50%	"bis zu 50 Prozent der voraussichtlichen"
Profit limit: profit of that year, without the deduction	EUR 200,000	"200 000 Euro nicht überschreitet"
Total cap per business on open deductions; same number, different rule	EUR 200,000	"je Betrieb 200 000 Euro nicht übersteigen"
Special depreciation in total under § 7g(5)	40%	"insgesamt 40 Prozent"

Ministry instructions for the 2026 EÜR form

What	Value	Note
Source	all figures below	https://www.bundesfinanzministerium.de/Content/DE/Downloads/BMF_Schreiben/Steuerarten/Einkommensteuer/2026-09-01-anlage-EUER-2026.pdf?__blob=publicationFile&v=2
Minimum business use for § 7g EStG, purchase year and the next	90%	"fast ausschließlich (mindestens zu 90 %)"
Small business starting during the year: turnover of that year	EUR 25,000	"Gesamtumsatz im laufenden Kj."
Special depreciation cap under § 7g(5) for an asset bought before 1 January 2024, which can still be inside its five-year window in 2026	20%	"Für Wirtschaftsgüter, die vor dem 01.01.2024 angeschafft oder hergestellt worden sind, beträgt die Höchstgrenze der Sonderabschreibungen nach § 7g Abs. 5 EStG weiterhin 20 %"

Geringwertige Wirtschaftsgüter (GWG): § 6 Abs. 2 EStG

GWG table

Method	Rule
Immediate write-off, § 6(2)	Full deduction in the purchase year, cost per asset less input VAT not above the limit below
Pool, § 6(2a)	Assets between the bounds below: one pool a year, released at one fifth a year
Standard depreciation, § 7	Anything else, over the useful life, one twelfth less per month before purchase

Low-value assets, the pool and the car (§ 6 EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__6.html
Immediate write-off: cost per asset, less input VAT contained in it	EUR 800	"das einzelne Wirtschaftsgut 800 Euro nicht"
Register duty for an asset written off at once, value above	EUR 250	"deren Wert 250 Euro übersteigt"
Pool: cost per asset above the first, not above the second	EUR 250 to EUR 1,000	"250 Euro, aber nicht 1 000 Euro übersteigen"
The list-price method needs business use above	50%	"mehr als 50 Prozent betrieblich genutzt"
Private use per month: share of the German list price at first registration, never the price paid	1%	"mit 1 Prozent des inländischen Listenpreises"
Electric car with no carbon dioxide emissions bought after 31 December 2018 and before 1 January 2031: a quarter of the list price is counted, but only where the gross list price is not above this amount. A cliff, not a ceiling on the amount counted. A car bought before 1 July 2025 may face a lower amount: check § 52 EStG	EUR 100,000	"nicht mehr als 100 000 Euro beträgt"

The alternative is the logbook method. Once the pool is chosen for a year, every asset of that year between its bounds goes into it (§ 6(2a) sentence 5 EStG). The 2026 EÜR instructions allow a one-year useful life for computer hardware and software.

Sonderabschreibung (Special Depreciation): § 7g Abs. 5 EStG

• Up to the total share in the § 7g table, spread over the purchase year and the four following years, on top of normal depreciation; § 52(16) EStG applies that share to assets bought after 31 December 2023. The prior year's profit must be within the § 7g profit limit and the asset used only or almost only for the business, or it is reversed. Over the asset's life the total never exceeds its cost.

Depreciation rates and date windows (§ 7 EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__7.html
Declining balance, movable assets bought after 30 June 2025 and before 1 January 2028: at most three times the straight-line rate and not above	30%	"und 30 Prozent nicht übersteigen"
Electric vehicles that are fixed assets, same window: share in the purchase year	75%	"im Jahr der Anschaffung 75 Prozent"

Outside a date window only straight-line depreciation applies, and a switch from declining balance to straight line is allowed, not the reverse. The electric vehicle rule prints its later shares in words and is barred where special depreciation was claimed. Other buildings: § 7(4) and § 7(5a) EStG; new rental housing § 7b EStG, in de-rental-income.

Section 5: Loss Utilization

Loss Utilization table (EStG § 10d)

Relief	Detail and limit
Intra-year offset	All sources are added up (§ 2(3) EStG), but ring-fenced losses offset only their own kind: investments (§ 20(6)), private sales (§ 23(3)), other services (§ 22 no. 3), models (§ 15b)
Verlustrücktrag	To the year before and then the second year before, ahead of special expenses. Caps below; the waiver is all or nothing
Verlustvortrag	No time limit. In full up to one million euros of total income (two million jointly, both in words), above that only the share below
Trade tax	Its own carry-forward at a lower share (§ 10a GewStG) and no carry-back
Investment deduction	It may create or increase a loss, but only within the § 7g conditions

Loss relief (§ 10d EStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__10d.html
Carry-back cap, single assessment	EUR 1,000,000	"einem Betrag von 1 000 000 Euro"
Carry-back cap, jointly assessed spouses	EUR 2,000,000	"einem Betrag von 2 000 000 Euro"
Carry-forward: share of the total income above the base	70%	"bis zu 70 Prozent des 1 Million Euro übersteigenden"

Trade tax loss carry-forward (§ 10a GewStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/gewstg/__10a.html
Share of the trade income above the base (one million euros, in words)	60%	"ist bis zu 60 Prozent"

Strategy

• The investment deduction is not a tool for a high-profit year: it is allowed only within the § 7g profit limit. A carry-back runs ahead of special expenses, so those of the earlier year can be lost, and a refund from it bears interest only from 15 months after the end of the loss year (§ 233a AO).

Section 6: Timing Strategies

These rules work for cash-basis (EÜR) businesses only; § 11 EStG leaves the balance-sheet rules untouched. Who must keep books: germany-bookkeeping.

Timing Strategies table

Strategy	Rule and what limits it
Defer invoicing	Receipts count in the year received (§ 11(1) EStG): the payment date decides. VAT differs, arising when the service is performed (§ 13 UStG)
Accelerate expenses	Expenses count in the year paid (§ 11(2) EStG). Prepayments for over five years are spread; fixed assets still follow depreciation
Regularly recurring items	§ 11(1) sentence 2 and § 11(2) sentence 2 EStG: a regularly recurring receipt or payment made a short time before or after the year end counts in the year it economically belongs to, not the year it moved. Rent, insurance and the VAT advance payment are the usual ones in practice, not in the statute, so for these the payment date does not decide. The statute prints no number of days
Investment deduction timing	Only within the § 7g profit limit, the asset bought in time and used almost only for the business
Year-end low-value purchases	Expensed in the business year of purchase; the purchase date decides, not payment
Vorauszahlungen	Due 10 March, 10 June, 10 September, 10 December, adaptable to the expected tax (§ 37 EStG); too-low ones bear interest from 15 months after the year
Adviser filing extension	Due at the end of February of the second following year, but interest still starts after 15 months and a late return costs a surcharge (§ 152 AO)
Marriage timing	The conditions need only arise during the year, so a marriage on any day of it opens joint assessment for the whole year

Pages: https://www.gesetze-im-internet.de/estg/__11.html and https://www.gesetze-im-internet.de/estg/__37.html

Section 7: VAT Optimization (Umsatzsteuer)

VAT Optimization table (Umsatzsteuergesetz (UStG))

Strategy	Rule and what limits it
Kleinunternehmerregelung, § 19(1)	Tax-free where turnover stayed under the first limit below last year and stays under the second this year. Both tests, and no input VAT. The current-year limit is hard: the 2026 EÜR instructions say the sale that crosses it is already taxed. A business that STARTS in the year has no previous year: its total turnover of that year must stay within the start-up limit in the ministry instructions table in Section 4, and the same rule applies when it is crossed.
Waiver, § 19(3)	Declared irrevocably to the tax office until the last day of February of the second calendar year after the period concerned, effective from the start of the period it is to cover, and binding for AT LEAST five calendar years. After that it can be revoked with effect from the start of a later calendar year
Ist-Versteuerung, § 20	On application, VAT on payments received: turnover below the limit below, release from the bookkeeping duty, or a liberal profession with no limit
Input VAT timing, § 15	On receipt of the supply plus an invoice meeting § 14 UStG; payment is not a condition. None on gifts, guest houses, hunting or yachts
Reverse charge for EU services	A service to a business is supplied where the recipient is established (§ 3a(2) UStG) and the German recipient owes the VAT (§ 13b UStG): germany-vat-return
Return period, § 18	Quarterly by default, monthly where the tax for the previous calendar year was above the § 18(2) UStG amount. A business that STARTS in 2026 is not automatically monthly: for the years 2021 to 2026 § 18(2) sentence 6 UStG puts the expected tax of the current year in place of the automatic monthly rule. Deadlines move by a month on application (§ 46 UStDV): germany-vat-return

Small-business limits (§ 19 UStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/ustg_1980/__19.html
Total turnover of the previous calendar year not above	EUR 25,000	"vorangegangenen Kalenderjahr 25 000 Euro"
Total turnover of the current calendar year not above	EUR 100,000	"laufenden Kalenderjahr 100 000 Euro"

Cash accounting limit (§ 20 UStG)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/ustg_1980/__20.html
Total turnover of the previous calendar year not more than	EUR 800,000	"nicht mehr als 800 000 Euro"

Section 8: Social Security Optimization

Legislation: Sozialgesetzbuch IV and VI. Ceilings, rates and the amounts for compulsorily insured self-employed people: de-social-contributions.

Self-Employed Social Security

Self-Employed Social Security table

Category	Detail
Mandatory cases	§ 2 SGB VI: teachers, educators and carers with no insured employee; midwives; sea pilots; artists and publicists; home-based traders; skippers; craftspeople in the Handwerksrolle; and persons with no insured employee working essentially for one client
Everyone else	Not compulsorily insured; voluntary insurance (§ 7 SGB VI), or compulsory insurance on application within five years of starting (§ 4 SGB VI). A Versorgungswerk follows state law, not the federal pages
One client is not false self-employment	That person is self-employed and pension-insured (§ 2 no. 9 SGB VI); false self-employment means the work is in truth employment (§ 7(1) SGB IV)

Pages: https://www.gesetze-im-internet.de/sgb_6/__2.html and https://www.gesetze-im-internet.de/sgb_4/__7.html

Optimization Strategies

Optimization Strategies table

Strategy	Detail
Voluntary pension contributions	Special expenses under § 10(1) no. 2(a) EStG, only up to the one cap in Section 9. Amounts: de-social-contributions
Versorgungswerk	In the same sentence as statutory contributions, so it shares that one cap
Krankenversicherung	Basic health and care contributions are special expenses; for private cover only the part comparable to statutory cover. The choice is not a tax question
Beitragsbemessungsgrenze	Contributions stop at each branch's ceiling; income above it adds none

Section 9: Investment & Retirement

Basisrente (Rürup-Rente): § 10 Abs. 1 Nr. 2 EStG

Basisrente table

Feature	Detail
What counts	Statutory pension, farmers' fund and comparable professional funds, and an own funded contract paying only a lifelong monthly annuity from age 62, with rights that cannot be inherited, sold or paid as a lump sum
Deduction limit	Full contributions since 2023, up to one cap shared by statutory, Versorgungswerk and Basisrente contributions. The statute prints no euro amount; the 2026 amounts are below
Later and locked	Taxed when paid (§ 22 EStG), at a share fixed by the year the pension starts and higher for each later year. The money is locked in

Pension contributions: deduction cap 2026

What	Value	Note
Source	all figures below	https://www.deutsche-rentenversicherung.de/DRV/DE/Ueber-uns-und-Presse/Presse/Meldungen/2026/260420-vorsorgen-und-steuern-sparen
Cap 2026, single person	EUR 30,826	"Höchstbetrag 30.826 Euro für Ledige"
Cap 2026, married couple	EUR 61,652	"61.652 Euro für Verheiratete"

Riester-Rente: § 10a EStG

Riester-Rente table

Feature	Detail
Eligibility	§ 10a(1) EStG names persons compulsorily insured in the statutory pension insurance and certain civil servants. Someone paying only voluntary contributions is not named; a compulsorily insured self-employed person is
Deduction, allowances	A yearly maximum as special expenses, allowance included (§ 10a(1) EStG); the tax office checks which is better. Allowances: § 84 and § 85 EStG, cut below the minimum own contribution of § 86 EStG. https://www.gesetze-im-internet.de/estg/__10a.html

Vermögenswirksame Leistungen (VWL) and Other

• VWL are employer-employee payments under the Fifth Capital Formation Act, whose § 1 excludes payments to members of the body representing a legal person, so not a GmbH managing director; a sole trader has no employer. https://www.gesetze-im-internet.de/vermbg_2/__1.html
• Günstigerprüfung. On application all investment income of the year is taxed at the tariff instead, where the total tax including surcharges is lower (§ 32d(6) EStG). Gains, funds and exit tax: de-capital-gains. Freelancer income tax: de-einkommensteuer-freelancer.

VWL and Other table: saver's allowance (§ 20 EStG)

Status	Allowance	Note
Source	all figures below	https://www.gesetze-im-internet.de/estg/__20.html
Sparer-Pauschbetrag, single individual, per year	EUR 1,000	"Betrag von 1 000 Euro abzuziehen"
Sparer-Pauschbetrag, jointly assessed couple	EUR 2,000	"Sparer-Pauschbetrag von 2 000 Euro"

Section 10: Red Lines

Red Lines table

Risk	Detail
§ 42 AO	An inappropriate arrangement giving a tax advantage the law does not provide for is an abuse unless non-tax reasons that matter overall are proven
Deferral models (§ 15b EStG)	Losses from a model aimed at early losses reduce only later income from the same source
Scheinselbständigkeit	Working under instructions and inside the other's work organisation (§ 7(1) SGB IV). Past periods: refer
Deduction without the investment	Reversed in the year claimed, with interest at the rate below from 15 months after that year
Fictitious family employment	The work must be real and the pay caused by the business; maintenance dressed as wages is not deductible
Hidden profit distribution	It does not reduce the GmbH's income (§ 8(3) KStG), and the statute does not define it
Private expenses as business	Household and living costs are out (§ 12 EStG), as are costs inappropriate by general standards (§ 4(5) no. 7 EStG)
Liebhaberei	§ 15(2) EStG requires a profit intention and says a tax reduction is not a profit; the tests are case law
Home office claims	Room costs only where the room is the centre of all business and professional activity

Interest on back tax and refunds (§ 238 AO)

What	Value	Note
Source	all figures below	https://www.gesetze-im-internet.de/ao_1977/__238.html
Per month on arrears and refunds after an assessment, periods from 1 January 2019	0.15%	"0,15 Prozent für jeden Monat"
The same rate per year	1.8%	"1,8 Prozent für jedes Jahr"

Section 11: Annual Tax Planning Calendar

Statutory due dates; one on a weekend or holiday runs to the next working day (§ 108(3) AO). VAT advance returns are due by the tenth day after each return period (§ 18(1) UStG), and the § 46 UStDV extension moves every VAT date by a month.

Annual Tax Planning Calendar table

Month	Action
January	10 January: VAT return for December or the fourth quarter. Check open investment deductions
February	15 February: trade tax prepayment. End of February: adviser returns for the year before last
March to June	10 March and 10 June: income tax prepayments. 15 May: trade tax prepayment. 10 April: VAT return for the first quarter. Compare single and joint assessment before filing
July	10 July: VAT return for the second quarter or June. 31 July: returns for last year without an adviser
August, September	15 August: trade tax prepayment. 10 September: income tax prepayment
October	10 October: VAT return for the third quarter or September. Check turnover against the small-business limit
November	10 November: VAT return. 15 November: trade tax prepayment. Plan pension contributions
December	10 December: income tax prepayment. 31 December: last day for payments to count in an EÜR, apart from the regularly recurring items in Section 6, for assets to be bought rather than ordered, and for a marriage to open joint assessment for the year

Section 12: Cash Impact Examples

The legacy examples used made-up incomes and computed a saving at an assumed rate. No official page prints those numbers and this library does not compute tax, so each is kept as the mechanism in words. For a real case apply the tariff formula of § 32a EStG once with the item and once without it, and never multiply a deduction by a top rate.

Example 1: Ehegattensplitting

Example 1. Joint assessment adds both incomes, taxes half at the tariff and doubles it, and doubles the surcharge limit, the saver's allowance and the pension cap. Work both options.

Example 2: Rürup-Rente Contribution

Example 2. Basisrente contributions, with statutory or Versorgungswerk ones, are special expenses up to the 2026 cap in Section 9 and cut taxable income by the amount paid, no more.

Example 3: IAB + Sonderabschreibung

Example 3. Part of the expected cost is deducted early; on purchase the same amount is added back and taken off the asset's cost, so depreciation runs on less. Over the asset's life the deductions equal its cost: the gain is timing.

Example 4: GWG Immediate Write-Off

Example 4. A laptop below the immediate write-off limit, measured without the input VAT in the price, is deducted in full in the purchase year unless the pool was chosen for that year.

Example 5: Homeoffice-Pauschale

Example 5. Qualifying days times the day rate in the § 4 table, never above the yearly cap there. Keep a record of the days.

The method, step by step

1. Fix the facts: legal form, trade or liberal profession (§ 15 and § 18 EStG), and EÜR or balance sheet (§ 4(3) EStG). https://www.gesetze-im-internet.de/estg/__4.html
2. Work out the expected profit and test it against the § 7g profit limit before any investment deduction or special depreciation. https://www.gesetze-im-internet.de/estg/__7g.html
3. Go through the deductions in Section 3, checking each limit and the separate record § 4(7) EStG demands. https://www.gesetze-im-internet.de/estg/__9.html
4. Per fixed asset: low-value asset or pool first, one choice for the whole year (§ 6(2a) EStG), then the depreciation method and its date window. https://www.gesetze-im-internet.de/estg/__6.html
5. Losses: offset within the year, then the carry-back or its waiver, then the carry-forward (§ 10d EStG). https://www.gesetze-im-internet.de/estg/__10d.html
6. Special expenses in the year paid, and the choice between single and joint assessment in the return (§ 10 and § 26 EStG). https://www.gesetze-im-internet.de/estg/__10.html
7. VAT: test both small-business limits before waiving the rule, knowing the waiver binds for at least five years. https://www.gesetze-im-internet.de/ustg_1980/__19.html
8. Test every idea against § 42 AO, write down the non-tax reasons, and refer before any change of structure; a binding ruling can be asked for beforehand, for a fee (§ 89 AO). https://www.gesetze-im-internet.de/ao_1977/__89.html

Ask the client first

• What is the legal form and kind of income, and is profit worked out by EÜR or by balance sheet?
• What is the expected profit this year before any investment deduction, what was last year's, and how much must be withdrawn to live on?
• Is the client married or in a civil partnership, both fully liable to tax in Germany and living together, and does the spouse work in the business?
• Which assets will be bought in the next three years, when, and how much will each be used privately?
• VAT: last year's total turnover, this year's so far, and are large purchases planned?
• How is the client insured for old age and health, and does the client work essentially for one client?

When to refuse or refer

• Anything cross-border: a home, spouse, income, clients, staff, company or assets outside Germany; treaties; foreign tax credits; controlled foreign company rules; transfer pricing (germany-transfer-pricing).
• Exit tax: leaving Germany, or giving shares abroad, with a shareholding within § 17 EStG or a large fund holding (§ 6 AStG). See de-capital-gains, and refer before the move.
• Any arrangement whose main purpose is a tax advantage, any model with planned early losses, any structure the client cannot explain by non-tax reasons.
• Choosing or changing the legal form: a GmbH, UG or GmbH & Co. KG, the § 1a KStG option, contributing a business under § 20 UmwStG, holdings, tax groups.
• A § 34a EStG application, which starts a record that runs for years and ends in a follow-up tax.
• Pay, loans, rent and pension promises between a GmbH and its owner: the hidden profit distribution tests are case law.
• Real estate structuring: property companies, splitting a price between land and building, private sales of property, real estate transfer tax, a shorter useful life for a building.
• Inheritance and gift planning, and handing the business on: the inheritance and gift tax act was not read for this Guide.
• Selling or closing the business, or selling shares: the § 16(4) and § 17 EStG allowances, the § 34 EStG reduced rate, the seven-year rule of § 22 UmwStG.
• Employing family members: the contract, the pay level, the social insurance status, and any suspected false self-employment.
• Electric and hybrid company cars other than the quarter rule in Section 4, and any car whose private use is disputed.
• Limited partners' losses (§ 15a EStG), the interest barrier (§ 4h EStG), farming and forestry.
• Tax arrears, deferral, enforcement, voluntary disclosure and any criminal tax matter.
• The exact church tax rate for a client: it is set by state church tax rules, not on the federal pages.
• The choice of a pension, insurance or investment product, and private versus statutory health cover.
• Computing the client's tax or a saving. Payroll: de-payroll. Trade tax: de-trade-tax. VAT returns: germany-vat-return. Bookkeeping: germany-bookkeeping. Rental property: de-rental-income. Formation: germany-formation.

Sources

Each paragraph is linked where it is used. Laws read: Einkommensteuergesetz, Abgabenordnung, Körperschaftsteuergesetz, Gewerbesteuergesetz, Solidaritätszuschlaggesetz, Umsatzsteuergesetz, Sozialgesetzbuch IV and VI and the Fifth Capital Formation Act, at https://www.gesetze-im-internet.de/ Also the ministry's 2026 EÜR instructions (Section 4) and tax booklet (Section 1), and the pension insurer's 2026 pages (Sections 8 and 9).

Disclaimer

This Guide and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this Guide. All outputs must be reviewed and signed off by a qualified professional (such as a Steuerberater or Wirtschaftsprüfer) before filing or acting upon.

Contributed by OpenAccountants.