Tax changes for 2022

Every year there are new changes in the tax law and 2022 is no excemption. Here, you find the most important changes for you as a self-employed person.

The ‘Grundfreibetrag’ (basic tax-free amount)

The so-called ‘Grundfreibetrag’ will increase to 9.984€ in 2022. (In comparison, it was at 9.744€ in the previous year.) If you are married and you and your spouse issue joint tax declarations, the ‘Grundfreibetrag’ is double, i.e. 19.968€.

The ‘Grundfreibetrag’ adjusts every year to secure the living wage (2020: 9.408€, 2021: 9.744€). So, you will not pay income tax if your total income (from self-employment and employment) is below this tax-free amount. Income tax must be paid on every euro earned that exceeds the amount of the current ‘Grundfreibetrag’. This means that 9,984€ (or 19,968€) will always remain tax-free for you.

Don’t forget that as a self-employed person you have to file an income tax return, even if you don’t exceed the ‘Grundfreibetrag’.

➡️ Not yet self-employed or just starting your business? Here you find all the info you need.

Amortization of computers and software

Until now, the rule was that computer hardware and software had to be amortized within three years.

As of 2021, only the period of one year applies. This means that if you buy a new laptop in 2022, you will be able to claim 100% of the tax on it this year. This rule applies to laptops and desktop computers, but also to power supplies and operating software, for example.

Option for ‘Körperschaftsteuer’ (corporation tax)

If, for example, you are self-employed with a craft business and have a ‘Personenhandelsgesellschaft’ in Germany (commercial partnership or partnership company), from 2022 you will have the option of being taxed like a corporation, i.e. a GmbH or AG.

Thus, you will be taxed at 15% ‘Körperschaftsteuer’ (corporation tax) and can thereby receive a tax advantage. The application for this option had to be made in time in 2021.

VAT reduction for the hospitality industry

Since the COVID crisis still governs large parts of our (working) lives, some laws for tax relief continue to apply to reduce the tax burden in 2022.

Relevant for self-employed restaurant owners is the reduction of the VAT percentage. In 2022, the reduced 7% tax rate will continue to apply to food served by restaurants and foodservice providers. This reduced VAT rate was adopted in 2020 and will remain in effect until the end of 2022.

Extension of the Home Office allowance?

Since many self-employed professionals, as well as employees, had to work from home due to the COVID pandemic, the Home Office allowance applied for 2020 and 2021. As, unfortunately, the pandemic is still relevant and the home office continues to be an important option for safe working, it is likely that the allowance will continue to apply for 2022.

➡️ This is how you make use of the Home Office allowance!

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