Germany small-business (Kleinunternehmer) VAT exemption calculator
Whether you may use the small-business exemption in Germany and how your profit differs with and without VAT.
Small business?
Yes
still €70,000.00 to the limit of €100,000
- Last year: up to €25,000
- Without VAT
Your turnover last year (€18,000.00) is within €25,000 and the expected turnover this year (€30,000.00) within €100,000: you can use the small-business exemption and do not charge VAT.
As a small business you keep €24,000.00 before income tax. With regular taxation and the same price for your customers it would be €20,110.08 (−€3,889.92), because the VAT is inside the price but the input tax €900.00 reduces your expenses. If you add the VAT on top, €24,900.00 (+€900.00) remain, and your customers pay €35,700.00 instead of €30,000.00.
I’m not an accountant or a financial advisor. This is an estimate, for information only. Check with a professional before you decide.
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What is left with and without VAT? Expenses count gross for a small business, net with regular taxation.
| Small business | With VAT, price stays | With VAT added on top | |
|---|---|---|---|
| Your customers pay | €30,000.00 | €30,000.00 | €35,700.00 |
| Net turnover | €30,000.00 | €25,210.08 | €30,000.00 |
| Business expenses | €6,000.00 | €5,100.00 | €5,100.00 |
| Profit before tax | €24,000.00 | €20,110.08 | €24,900.00 |
| VAT to the tax office | €0.00 | €3,889.92 | €4,800.00 |
How it works
- The check follows UStG § 19 and the Federal Ministry of Finance’s application letter of 18 March 2025: the total turnover (the payments received) of the previous year must not have exceeded €25,000, and that of the current year must not exceed €100,000. If the business began in the current year, only this year’s turnover counts, with the limit of €25,000.
- The comparison calculates the profit before income tax. As a small business it is turnover minus business expenses including the VAT paid, because input tax cannot be deducted. With regular taxation turnover and expenses count net: if the price for the customer stays the same, the VAT is inside the price and the net turnover falls to turnover ÷ (1 + rate); if you add the VAT on top, the net turnover stays the same and your customers pay more.
- The VAT to the tax office is the VAT collected minus the input tax. It is no expense for you and not included in the profit, but you have to pay it over.
Worked example
Turnover last year €18,000, expected this year €30,000, business expenses €6,000 gross with €900 input tax, rate 19%: you may be a small business; the profit before tax is 30,000 − 6,000 = €24,000. With regular taxation and the same price: net turnover €25,210.08, net expenses €5,100, profit €20,110.08, VAT to the tax office €3,889.92. With VAT added on top: profit €24,900, customers pay €35,700.
Sources
- UStG § 19: taxation of small businesses — gesetze-im-internet.de (in German)
- Federal Ministry of Finance letter of 18.03.2025: special rule for small businesses (amendment of the VAT Application Decree, sections 19.1 ff.) (in German)
- Federal Ministry of Finance letter of 10.11.2025: small-business rule (in German)
- UStDV § 34a: invoices of small businesses (in German)
- UStG § 18: taxation procedure (para. 4a) (in German)
Text checked on October 5, 2026
Good to know
- Invoices: as a small business you issue them without VAT, with the amount in one sum and the note that the tax exemption for small businesses applies (UStG § 19), and with a tax number or small-business identification number (UStDV § 34a). If you show VAT anyway, you owe it (UStG § 14c).
- Input tax: you cannot deduct the VAT on purchases and expenses for your small-business turnover (UStAE section 15.2). That is mainly not worthwhile if you invest a lot.
- Obligations: small businesses generally file no VAT advance returns and no annual VAT return (UStG § 19 para. 1 sentence 2); there are exceptions, among others for services for which you owe the tax under § 13b (UStG § 18 para. 4a).
- Waiver: you can waive the tax exemption, for example if you have high input tax and your customers are businesses that deduct the VAT. The waiver is irrevocable and binds for at least five calendar years (UStG § 19 para. 3).
- E-invoicing: small businesses may continue to issue their invoices as other invoices (for example as a PDF or on paper) (UStDV § 34a).
- This is not tax advice: the choice between the rules depends on your customers, your prices and your expenses. If in doubt, get advice from a tax adviser.
Frequently asked questions
What are the limits of the small-business exemption?
Total turnover last year must not have exceeded €25,000, and in the current year it must not exceed €100,000 (UStG § 19 para. 1). Both apply without VAT, calculated by the payments received.
What happens if I exceed the limit during the year?
If you exceed €100,000 in the current year, the turnover that exceeds the limit is already fully subject to VAT: from then on you charge VAT. If you had more than €25,000 last year, the exemption does not apply in the current year at all (Federal Ministry of Finance letter of 18.03.2025).
Does the €25,000 limit also apply in the start-up year?
Yes: in the year you start the activity, only this year’s turnover counts, and the limit is €25,000, not €100,000 (UStAE section 19.1 para. 3).
Is the small-business exemption worthwhile?
It depends on your customers and expenses. With private customers who cannot deduct VAT, you keep more as a small business if you do not want to raise your price. With business customers and high input tax, regular taxation can be cheaper. Try your numbers above.
Where do I say that I am a small business?
To the tax office in the «questionnaire for tax registration», which you fill in online through ELSTER; there you also answer the questions on expected turnover. The tax office then assigns the tax number.