German small business limit: EUR 25,000 / 100,000

In short

In Germany you are a small business (Kleinunternehmer) if your total turnover was no more than EUR 25,000 in the previous year and does not exceed EUR 100,000 in the current year (§ 19(1) UStG). In the year you start, only the EUR 25,000 limit applies. Your sales are then VAT-exempt, and you cannot deduct input VAT.

As of 3 October 2026 · General information, not tax advice.

Since 1 January 2025, sales by small businesses are VAT-exempt. You charge no VAT and, as a rule, file neither advance VAT returns nor an annual VAT return (§ 19(1) sentence 3 UStG). The scheme applies without an application as long as you stay within the limits.

What counts is total turnover based on payments received (§ 19(2) UStG). Certain exempt sales, such as medical treatment, are not counted, and neither are sales of fixed assets such as a used company car.

The EUR 100,000 limit takes effect immediately: the very sale with which you exceed it in the current year is taxable, and so is every later one (section 19.1(2) UStAE). There is no tolerance as in Austria. From that point you issue invoices with VAT and file advance returns. If your previous year's turnover was above EUR 25,000, you are not a small business for the whole current year, even if you stay below EUR 25,000 this time.

If you start your business during the year, only that year's actual turnover counts, and the limit is EUR 25,000 instead of EUR 100,000 (section 19.1(3) UStAE). The sale with which you exceed EUR 25,000 in the founding year is already subject to normal VAT (section 19.7(1) UStAE). Example: you start in March 2026 and have received EUR 22,000 by November. A EUR 4,000 payment in December exceeds the limit; that sale is already taxable.

You can opt out of the scheme, for example to deduct input VAT on investments. You notify the tax office by the last day of February of the second following year; the waiver takes effect from the start of the year it covers and binds you for at least five calendar years (§ 19(3) UStG). Input VAT on purchases made before switching to normal VAT cannot be deducted afterwards; a correction is only possible under § 15a UStG (Federal Ministry of Finance letter of 10 November 2025).

Your invoices show no VAT and state that the small business exemption applies (§ 34a UStDV). You must be able to receive e-invoices, but you may always send your own invoices on paper or as a PDF. Since 2025 you can also use the exemption in other EU countries if your EU-wide turnover does not exceed EUR 100,000 and you take part in the special reporting procedure with the Federal Central Tax Office (§ 19a UStG).

In Saldek

For German organisations, Saldek creates small business invoices without VAT and with a note on § 19 UStG. Checking that you stay within the limits is up to you, especially in the year you start.

Questions about this term

Which limit applies in the year I start?

EUR 25,000, based on the actual turnover of that year. The EUR 100,000 limit only applies from the following year, provided you did not exceed EUR 25,000 in the founding year.

What happens if I go over EUR 100,000 during the year?

The sale with which you exceed the limit is already taxable, as is every later one; earlier sales stay exempt. In the following year you are under normal VAT because your previous year's turnover was above EUR 25,000.

What must my invoice show?

Your and your customer's name and address, your tax number or VAT ID, the invoice date, the quantity and type of goods or services, the amount and a note on the exemption, for example "Steuerfreie Kleinunternehmerleistung gemäß § 19 Abs. 1 UStG" (§ 34a UStDV).

Does the German limit also apply in Austria?

No. In Austria the small business limit is EUR 55,000 annual turnover, with a 10% tolerance in the current year (§ 6(1)(27) UStG 1994).

Small business exemption in Germany (§ 19 UStG)