Tax return for GmbHs

Tax return for GmbHs: Good advice pays off

Manual receipt processing and data entry may be good enough for a personal tax return or even for a small-sized enterprise. However, larger companies and corporations need a professional accountant to prepare their tax return. Tax returns for limited companies (GmbHs or AGs) can be quite complex.

Besides trade tax and value added tax, GmbHs and AGs also have to pay corporate tax. The tax return of a GmbH must therefore include the documents that the tax authorities need to review taxes and establish taxes for the next fiscal year. For companies other than corporations, a simple Profit and Loss Account is sufficient in the tax return. However, tax return of GmbHs must include a Tax Balance Sheet.

A good tax return creates liquidity

The Tax Balance Sheet is not the same as the Commercial Balance Sheet, which the GmbHs must keep in accordance with the Commercial Code. Rules for revenue and cost recognition, and particularly for depreciation, are different. If you do not understand all the relevant details, you should leave the preparation of the tax return to a professional tax advisor. Ideally someone who has experience with the particular industry sector or the company’s field of activity. The tax return of a GmbH that operates internationally, for example, is in good hands with tax advisors like RBO, that have extensive experience and expertise in international tax law.

Create liquidity!


An experienced tax advisor may create liquidity for the company with a good tax return.

Advisors use legitimate tax saving strategies and also know what might trigger a tax audit. The tax office compares the information submitted in the tax return with average and benchmark values for similar companies. Significant differences may trigger a tax audit. One of the duties of the tax advisor is to warn the company management of such potential problems at an early stage.

GmbH’s tax return may trigger a tax audit

If you are notified of a tax audit, there is no need to panic. Audits do not automatically mean that the tax return of the company was wrong. An audit does not mean that you have done something wrong. The tax office regularly and randomly selects a series of returns to examine. In any case, an experienced tax advisory firm such as RBO can have you covered. Audits usually end with an audit closing meeting where findings and results are shared with management. It can be particularly useful to have a tax expert present at that meeting, who knows the details of the tax return or prepared the tax return, so that they can answer the auditor’s questions and reflect on the findings.

In case of a tax audit, you should have  all necessary documents properly ordered and within easy reach. Some companies also leave this to a specialist, usually the one who prepared the tax return for the company. RBO would, of course, be glad to help you also in this field.

A quiet warning on directors’ personal liability for corporate tax

GmbH founders and directors often assume, wrongly, that the company’s liability is limited and therefore there is no financial risk involved for them personally. But managers, who deliberately provide false information in a tax return to save taxes can find themselves held personally liable for their company’s tax debt. Therefore it is in the best interests of management to get expert advice on which tax avoidance techniques are legitimate and where tax evasion begins.

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