What does the small-business rule actually do?

It exempts you from charging VAT (Umsatzsteuer) on your invoices and from filing regular VAT returns. In exchange, you cannot reclaim input VAT on your business purchases.

What happens if I exceed €22,000?

If your prior-year turnover exceeded €22,000, you lose Kleinunternehmer status for the following year and must charge VAT from 1 January, register, and file returns. The €50,000 figure is the current-year forward limit.

Can I opt out of the Kleinunternehmer rule voluntarily?

Yes. You can waive the exemption (Option zur Regelbesteuerung), which lets you reclaim input VAT — useful if you have large startup costs. The waiver binds you for five calendar years.

Does turnover here include VAT?

The €22,000 and €50,000 limits are measured on gross turnover. Because a Kleinunternehmer charges no VAT, the gross and net figures are effectively the same for these tests.

Germany Kleinunternehmer Threshold Checker

Q: What are the Kleinunternehmer thresholds?

Under §19 UStG you qualify if your prior-year turnover did not exceed €22,000 and your current-year turnover is not expected to exceed €50,000. Both conditions must be met for the calendar year in question.

The German Kleinunternehmerregelung (small-business rule) under §19 UStG lets very small businesses skip charging and reporting VAT. You qualify when your prior-year turnover stayed at or below €22,000 and your current-year turnover is not expected to exceed €50,000. This checker applies both limits so freelancers and side-business owners can see whether they still qualify.

How it works

§19 UStG sets a two-part test that must hold for the year in question:

Prior-year limit — turnover in the previous calendar year was ≤ €22,000.
Current-year limit — turnover in the current calendar year is not expected to exceed €50,000.

If both hold, you are a Kleinunternehmer: you issue invoices without VAT (with a §19 note), file no regular VAT returns, but also cannot deduct input VAT (Vorsteuer) on your purchases. Cross either limit and you fall under regular taxation (Regelbesteuerung) and must charge VAT.

Example

A designer earned €18,500 last year and expects €30,000 this year. Prior year ≤ €22,000 and current year ≤ €50,000 — both pass, so they remain a Kleinunternehmer and invoice without VAT. If last year had been €24,000, they would lose the status this year and must charge VAT from 1 January.

Notes

Screening tool only. New businesses test only the current-year limit (pro-rated for the months in operation). Opting out of the rule binds you for five years. Confirm with a Steuerberater (tax adviser) or the Finanzamt before relying on this.