This website is using cookies to ensure you get the best experience possible on our website.
More info: Privacy & Cookies, Imprint
There are several options how to start your own business without equity.
1. Credit: Many banks offer loans with which you can finance yourself as a founder. The conditions can vary and proof of creditworthiness may also be required.
2. Business angels: business angels are investors who help entrepreneurs with their start-up. They provide support to the business in the form of financial backing, advice and networking.
3. Crowdfunding: crowdfunding is a way to raise capital through a platform on the internet. It is used to raise money for new products, projects or businesses.
4. Government funding: There are many government funding programs that can help entrepreneurs fund their startup.
5. Business plan competitions: there are many competitions where you can submit a business plan and win cash prizes. If the business plan is convincing, you can also find investors who will give you a hand.
Founding a company is an exciting step, but it also requires tax considerations. When starting a business, founders need to consider a variety of tax issues, including VAT, income tax and trade tax. In this article, we take a closer look at these tax aspects and how they affect budding entrepreneurs.
Sales tax: when is it relevant?
Sales tax, also known as VAT, is a consumption tax levied on the sale of goods and services. In Germany, the general VAT rate is currently 19%, while the reduced rate is 7%. When setting up a company, founders must decide whether they want to be liable for VAT or not.
The VAT liability can be relevant for companies that offer goods or services that are subject to VAT. If a company is liable for VAT, it must collect VAT on its sales and pay it to the tax office. At the same time, it can claim the input tax it has paid for business expenses.
Income tax: personal tax liability
Income tax concerns the personal tax liability of the founders and owners of a company. In Germany, income from self-employment and entrepreneurial activity is generally subject to income tax. The amount of income tax depends on the income and the personal tax rates.
It is important to note that in Germany the Income Tax Act makes a distinction between tradespeople and freelancers. Freelancers, such as doctors, lawyers and engineers, are subject to different tax rules than tradespeople who produce goods or provide services.
Trade tax: For companies with commercial operations
Trade tax is a municipal tax levied on companies that operate a trade. The amount of trade tax depends on the amount of trade income and the assessment rate of the respective municipality. Founders must check whether their activity is classified as commercial and whether they are subject to trade tax.
Crowdfunding and legal provisions: Financing for start-ups
Crowdfunding has become a popular financing method for start-ups. It allows founders to raise capital from a variety of investors, often via online platforms. Despite its appeal, start-ups must observe certain legal provisions when using crowdfunding:
1. Crowdfunding platforms: Start-ups should ensure that the crowdfunding platform they select meets the legal requirements and has a valid license.
2. Type of company: The type of company can have an impact on the legal requirements for raising capital. Some forms require the publication of certain information for investors.
3. Transparency: Start-ups must be transparent about their business, financial position and risks. This is crucial to gain the trust of investors.
4. Contracts and agreements: It is advisable to seek professional legal assistance to properly draft the contracts and agreements with investors and ensure that they comply with applicable laws.
Proper advice and compliance with the law are crucial to running successful crowdfunding campaigns and avoiding legal issues.
Conclusion
Tax considerations and legal regulations are key aspects of starting a business and raising capital via crowdfunding. Founders should learn about tax obligations early on and consult legal experts to ensure that their business operations comply with applicable laws and regulations. With the right preparation and advice, founders can maintain their financial integrity and build their business successfully.
There are many self-proclaimed experts and coaches who try to run people through advice and sales. These individuals often offer a variety of services designed to help people achieve their goals. These services range from financial advice to personal development to career counseling. They promise that their services will help people improve their lives, but it is important to note that many of these "experts" do not have the qualifications or knowledge to actually help.
Experts and coaches are mainly trying to make money by giving advice and selling, rather than giving truly useful information. They may try to get people to buy a product or service they don't really need through a sales pitch. They may also try to get people to spend more money than they actually can to get a particular service or product. This type of "advising" can be harmful, as it does not help people achieve their goals, but instead entices them to pay more than they actually can.
It is therefore important to carefully check if the services from an expert or coach are really useful. One should always do an in-depth research before considering any consultation or sale. Pay attention to the qualifications of the expert and make sure that they have experience and knowledge to really help you achieve your goals. This way, you can ensure that you don't fall victim to a scam.