Multiple use of the small business regulation

Multiple use of the small business regulation by distributing business activities among several independent companies is not possible.

Companies that do not generate more than 17,500 euros in sales per year can use the small business regulation for sales tax and do not have to invoice sales tax and pay it to the tax office. In return, however, no input tax can be deducted from incoming invoices. An entrepreneur wanted to use the small business regulation several times by distributing his business among several companies in order to be able to offer his services VAT-free despite sales significantly above the small business limit. This construction has now been clearly rejected by the Federal Fiscal Court. While the tax court still classified the multiple use as an abuse of structuring possibilities and therefore dismissed the action, the Federal Fiscal Court does not even see the possibility of multiple use, regardless of whether it is abusive or not, in an interpretation of VAT law that conforms to EU law.