Should I abandon my "Gewerbeschein" ? Tax consultant advice

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Hi Guys,
 
hope someone can lead me to what's right.
 
Basically, I own a 2 bedrooms flat that I rent out on short-term basis (1 day, 2 days, 1 week etc...) to guests. The flat can be occupied as a single room or both double rooms. 
I do not provide any breakfast but just fresh toiletteries, bedsheets and towels. TV and internet are also included. I advertise the service via airbnb and also on my flat website. When guests book from my website, I issue the invoices myself.
As for the invoices, I have received a "Gewerbeschein for Zimmervermiettung". This is registered under the "Kleinunternehmer" scheme due to the low annaul income.
 
Today, my tax consultant says I should deregister my business as I am considered a landlord and not a "trade/business".  I am quite confused as the business model was clearly explained to the "Ordnungsamt" before I receive my "Gewerbeschein". On top, I had to get an approval from the Bauamt.
 
What is right here? 
 
Thanks,
Melf
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Well, your case could be classified either one way or the other, with the Finanzamt tending to try to classify as many cases as possible as gewerblich, since that would mean extra taxes:

  • VAT, as soon as you exceed the 17,500€ Kleinunternehmer turnover limit (with you still remaining a Kleinunternehmer for the last time during the year in which you broke that 17,500€ turnover limit, but remained under the absolute turnover limit of 50,000€).
  • Gewerbsteuer once your yearly profit exceeds 24,500€.

You can read up on the different classification criteria here:

However, since you are a Kleinunternehmer-Gewerbetreibender and therefore have to pay neither VAT nor Gewerbesteuer, since your turnover (and therefore profit) is that low, I don't really see the Steuerberater's problem.

After all, you would pay the same amount of income tax either way, and this way at least he gets to charge you a bit extra for filling in the few entries for Kleinunternehmer in the Gewerbesteuererklärung, so it's in his own self-interest to leave it this way.

The rental profit is at the moment declared in Anlage G, and would in case of a private rental be declared in Anlage V, so he would get the fee for filling in an Anlage either way.

 

Or is that tax consultant maybe not a Steuerberater but only someone working at a Lohnsteuerhilfeverein?

If yes, then I can understand why, since Lohnsteuerhilfevereine are officially forbidden to do tax returns for self-employed people, and he would lose you entirely as a client if you don't switch over to treating this as a private rental, i.e. if you don't agree to his suggestion, deregister your Gewerbe and in the future declare the profit in Anlage V.

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Hi Panda,

 

Many thanks for the explaination. 

I had to leave the Lohnsteuerverein because of the Gewerbe. Now, the Steuerberater (he is a steuerberater) wants me to de-register my business for reasons that are unclear to me. 

 

Could it be that I will end up paying more taxes because of the Gewerbe? (Note that I have stable job with good income)

 

 

and other questions are:

  • Are there any pros or cons if I deregister the business as advised by the Tax consultant? 
  • When I deregister, can I still issue invoices under par.19 ?
  • What happens to all expenses related to business (Toiletteries, cleaning fees, communication costs, cost for new bedsheets and etc..) ? Can they be claimed when I deregister?

 

Maybe I will need to get a new tax consultant?

 

thanks,

Melf

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No, the income tax is the same, since in Germany all sources of income are added up and only then is income tax calculated.

And as I said, you are not yet at the levels where you would have to pay the additional taxes VAT and Gewerbesteuer.

 

  1. No really. Though getting the Finanzamt to accept that an activity that they treated as gewerblich up till now is suddenly private will be an uphill struggle... Maybe the Steuerberater wants to charge you for the letters he will have to write to the Finanzamt to make this change happen?
  2. No, since you will no longer be an Unternehmer, i.e. a business (§19 UStG is about Kleinunternehmer), but just a private person.
  3. Yes.
  4. That would probably be easiest if he just won't let you leave things as they are.
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The business is just 1 month old . Since my Lohnsteuerverein  wont do  the work for me, hence the reason i contacted the tax consultant.

 

But since he wants me to move in a new direction,  I will need a new tax consultant. 

 

I am happy if you have recommendations.

 

Thank you,

Melf

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Sorry, no recommendation, apart from the suggestion to choose a female Steuerberaterin this time, in my experience female professionals are more honest.

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Okay many thanks: will do -

And you are right. the female at the Lohnsteuerverein was great!!!

Thanks a lot for the explaination as well. I will update how it goes in a few days from now

 

I appreciate it.

 

Thanks,

M

 

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