Trade Tax Calculator Germany
German trade tax from profit and municipal multiplier, with the sole-trader allowance, 3.5% base rate and credit against income tax under § 35 EStG.
Typical: 200% - 900%. Average approx. 400%.
Trade tax
€10,570.00
Effective burden
€0.00
Detailed calculation
Effective trade tax rate
Based on profit
0.00%
Allowance of €24,500.00 applies only to sole proprietorships and partnerships. The income tax credit under §35 EStG is max. 4 times the tax assessment. Without guarantee.
Note: These calculations are for informational purposes only and do not replace professional tax or financial advice. All information without guarantee.
FAQ
Frequently Asked Questions
How is trade tax calculated?
Trade tax is calculated by multiplying the trade income by the base rate of 3.5% and then by the municipality's levy rate. Sole proprietors receive a tax-free allowance of 24,500 euros.
Who has to pay trade tax?
All commercial businesses are subject to trade tax. Freelancers (Freiberufler) and agricultural businesses are exempt. Sole proprietors benefit from a 24,500 euro allowance.
Why does a GmbH pay more trade tax than a sole proprietorship with the same profit?
Corporations receive neither the €24,500 allowance nor the credit against income tax under § 35 EStG. Example with €100,000 profit and a 400% levy rate: the sole proprietorship pays €10,570 trade tax (€75,500 × 3.5% × 400%) but can credit 4 times the tax base amount of €2,642.50 against its income tax, so effectively €0 remains. The GmbH pays €14,000 (€100,000 × 3.5% × 400%) with no credit. The full credit does, however, require the income tax on the business income to be high enough.
Guide
What is the Trade Tax Calculator Germany?
The trade tax calculator computes the trade tax for businesses based on trade income and the municipal multiplier.
How does the Trade Tax Calculator Germany work?
From the profit, add-backs and deductions are applied. The tax measurement figure of 3.5% is applied to trade income and the result is multiplied by the municipal rate. Sole traders and partnerships receive an allowance.
Key Data and Facts
Tax measurement figure: 3.5%. Allowance for sole traders/partnerships: 24,500 euros. Minimum multiplier: 200% (from 2027: 280%, § 16(4) GewStG). Average multiplier of all municipalities: 409% (Destatis, 2024).
Step-by-Step Guide
How to calculate trade tax (Gewerbesteuer) step by step: 1. Determine the trade income: start with the taxable profit (profit from the commercial business). Add the additions (e.g. 25 % of the financing portions of interest, rents and lease instalments above the 200,000 EUR allowance) and subtract the reductions (e.g. since 2025 the property tax on business-owned land that was booked as an operating expense, § 9 No. 1 GewStG). 2. Deduct the allowance: sole traders and partnerships receive a 24,500 EUR allowance. Corporations (GmbH, AG) have no allowance. 3. Calculate the tax base amount: trade income x 3.5 % (tax assessment rate). 4. Apply the multiplier: tax base amount x the municipality's multiplier (in %). 5. Trade tax credit: sole traders can credit 4 times the tax base amount against their income tax. Example: a sole trader with 80,000 EUR trade income in München (multiplier 490 %). Trade income: 80,000 EUR. Allowance: 24,500 EUR. Taxable trade income: 55,500 EUR (rounded down to a full 100: 55,500 EUR). Tax base amount: 55,500 x 3.5 % = 1,942.50 EUR. Trade tax: 1,942.50 x 490 % = 9,518.25 EUR. Income-tax credit (4 times): 1,942.50 x 4 = 7,770 EUR. Effective burden after the credit: approx. 1,748 EUR.
Calculation Example
Sole proprietor, trade income 80,000 EUR, München (assessment rate 490%). After allowance (24,500 EUR): 55,500 EUR. Tax base amount: 1,942.50 EUR. Trade tax: 9,518.25 EUR. After income tax credit (7,770 EUR): effective burden approx. 1,748 EUR.
Sources
Official sources
Calculations are based on applicable German laws and official data:
- Einkommensteuergesetz (EStG) — gesetze-im-internet.de
- Bundesministerium der Finanzen (BMF)
- Statistisches Bundesamt (Destatis)
Full methodology at Methodology.
Reviewed by Konstantin Iakovlev · Last updated:
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