Profit from private enterprise

Sound administrative records

Report your profit from a private enterprise here, submitting a balance sheet and profit and loss account. If you operate an own company or perform a profession in an independent capacity, for example, an sole proprietorship, you are required to keep sound administrative records of your income and expenditure. Please refer to the overview below for the costs that are deductible, deductible in a limited capacity, or not deductible.

Overview of deductible, deductible in a limited capacity, and non-deductible expenses

Type of costs	Employee costs	Entrepreneur IT costs
Office in the home of the taxpayer	Deductible subject to conditions	Deductible subject to conditions
Commuting	Not deductible	Not deductible
Vessels for representation purposes	Not deductible	Not deductible
Workwear	Deduction	Deduction
Regular clothing	Not deductible	Not deductible
Professional literature	Deduction	Deduction
Telephone plan registered in a private capacity	Not deductible	Not deductible
Costs of criminal activities	Not deductible	Not deductible
Bribes	Not deductible	Not deductible
Audio and video equipment, computer equipment, and telecommunications equipment	Deductible, divide costs over a period of 3 years and with a threshold of USD 419	Fully deductible
Courses, conventions, seminars, symposia	Deductible for 75%, up to USD 1,397	Deductible for 80%
Personal care	Not deductible	Not deductible
Food, drinks, and stimulants	Not deductible	Deductible for 80%, refer to Article 9(c)(4)
Gifts and business gifts	Not deductible	Deductible for 80%, refer to Article 9(c)(4)
Representation costs (receptions, festive events, and entertainment)	Not deductible	Not deductible
Excursions, study trips	Not deductible	Deductible for 80%
Corporate travel	USD 0.20 per kilometre	For private use of car: USD 0.20 per kilometre. For company car: unlimited
Costs of provided car	Fuel costs only (petrol or diesel)	n/a

When calculating your profits, you must at least take the following aspects into account:

Company car - If the car is part of your company assets and the costs are charged to the profits, you must still consider the private use of the car. You must add at least 15% of the original new value, including GET, of the car to the profits, provided that no more than the actual costs minus 15% of the new value of the car, including turnover tax and import levies, may be charged to the profits. If the car is part of your private assets, the costs of corporate travel, except for commuting, may be charged as operating costs up to an amount of USD 0.20 per kilometre. You must enclose a correct mileage registration form in this respect.

Immovable property - If an immovable property is part of the company assets of the entrepreneur, the following situations can be identified:

1. the immovable property is available to the owner/entrepreneur as his main residence (own home);
2. the owner/entrepreneur lets the immovable property to third parties or makes it available to third parties;
3. the immovable property is used by the company.

Own home - If a home is part of the company assets and available to you as your main residence, you must add the rental value of this home to the profits. You can deduct the maintenance costs of this home from the profits. Costs incurred to improve the home are not deductible.
Please note! Depreciation costs are deductible.
Please note! Mortgage interest is deductible without any limitations.
Please note! Other costs, such as a fire insurance, land tax, leasehold payments, and land rental are not deductible.

Letting of immovable properties - If you let an immovable property that is part of your company assets, the rental income will be fully subject to taxes and the costs for maintenance, fire insurance, land tax, leasehold payments, land rental, and depreciation are fully deductible.

Provided home - If you, as an entrepreneur, make a home that is part of your company assets available to an employee, the deduction of costs of this home is capped. You cannot deduct any more costs than the amount considered part of the income of the employee as the taxed rental value (income in kind), specifically 4.8% of the sales value of the home plus 2% of the value of the home (for the application of the land (tax) with a maximum of USD 1,676).