Tax optimisation - reduce your tax burden with active tax planning
Tax optimisation: a must for every company, but also for private individuals
Reducing the tax burden through clever and forward-looking tax planning enables not only companies but also private individuals to utilise financial resources more efficiently and invest in activities that promote growth.
In times of increasing tax requirements and complex legal framework conditions, it is more important than ever to fully exploit the opportunities for tax optimisation. Companies benefit from a comprehensive analysis of their tax situation and the development of customised strategies to reduce their tax burden. Private individuals can also significantly reduce their tax burden through targeted measures and thus gain more financial room for manoeuvre.
What is tax optimisation? – The basics of tax optimisation
The aim of tax optimisation is to minimise the tax burden of companies and private individuals within the scope of the law. It is a proactive and strategic approach that aims to reduce the tax rate and free up financial resources.
Tax optimisation is not the same as tax evasion:
- Tax evasion is illegal and involves the deliberate concealment of income or the presentation of false facts to the tax authorities.
- Tax optimisation, on the other hand, is completely legal and is based on the use of explicitly provided regulations and room for manoeuvre in tax law.
National and international tax optimisation:
Tax optimisation can take place in both national and international tax law. While national tax optimisation focuses on the structuring options within Germany, international tax optimisation also includes aspects of international tax law, for example for companies with subsidiaries or permanent establishments abroad.
At its core, tax optimisation is about minimising the tax burden through forward-looking action and clever structuring, thereby increasing the financial leeway for entrepreneurs and private individuals.
Take the opportunity to reduce your tax burden and increase your financial efficiency. Arrange your personal consultation and take the first step towards more efficient tax planning.
Examples of tax optimisation for companies
Minimising the tax burden requires well thought-out tax planning that takes both national and international aspects into account. Here are some proven strategies and examples of how companies can optimise their tax burden:
Companies can benefit from different tax rates in different countries through skilful location selection and relocation of functions. For example, relocating production facilities to countries with lower corporate taxes can significantly reduce the tax burden.
In international groups, tax payments can be optimised by adjusting transfer prices for goods and services between the individual parts of the company.
Establishing financing companies in countries with favourable tax conditions can help to make interest expenses tax deductible and thus reduce the tax burden.
Loss offsetting allows losses from one financial year to be offset against profits from other years in order to reduce the tax burden.
Choosing the right legal form (GmbH, GmbH & Co. KG, etc.) can have a significant impact on the tax burden. A conversion or new formation can therefore be worthwhile.
Investments in research and development can bring tax advantages, such as the tax deductibility of research expenses or special tax credits.
Government support programmes and tax incentives offer companies attractive opportunities to reduce their tax burden.
Companies can use double taxation agreements to ensure that their income is not taxed in several countries.
Risks associated with tax optimisation: structuring abuse and tax evasion
While the aim of saving taxes is perfectly legitimate, some tax avoidance strategies operate in legal grey areas. It is therefore important to know the risks involved in tax optimisation and to be aware of them.
Identifying possible risks in tax optimisation
Various risks can arise when implementing tax optimisation measures:
Complex tax regulations can be misinterpreted.
Tax avoidance strategies that are legal today could be considered illegal tomorrow.
Aggressive tax optimisation can lead to negative public perception.
Optimisation measures can result in increased attention from the authorities.
The legislator has enshrined regulations against the abuse of tax planning in tax law. § Section 42 of the German Fiscal Code (AO) enables the tax authorities to refuse to recognise structures that are classified as abusive for tax purposes. This can lead to considerable additional payments and legal consequences.
Professional support with tax planning and tax optimisation
The importance of professional tax advice and support
Given the complexity of tax law and the associated risks, it is advisable for companies to seek professional support for tax planning and optimisation. Experienced tax advisors and financial experts have the necessary expertise to develop customised strategies that take into account both the company’s tax objectives and the current legal framework.
Advantages of working with LW-P Lüders Warneboldt:
- Comprehensive expertise: our interdisciplinary teams of tax advisors, lawyers, auditors and business consultants offer you holistic advice that takes all relevant aspects into account.
- Customised solutions: We develop customised strategies that are tailored to your specific business situation and objectives.
- Legal certainty: We ensure that your tax planning always complies with the applicable laws and that you are protected from legal risks.
- Long-term partnership: We provide you with ongoing support for your tax planning and adapt your strategy to changing conditions as required.
Our range of services:
- Tax planning and optimisation: We analyse your tax situation, identify optimisation potential and develop individual strategies to minimise your tax burden.
- Tax structuring: We advise you on the structuring of contracts, company structures and transactions in order to utilise tax advantages.
- Representation vis-à-vis the tax authorities: We take care of communication with the tax authorities and represent your interests during tax audits and tax proceedings.
- International tax law: We support you in the tax structuring of international business activities and in avoiding double taxation.
Would you like a comprehensive analysis of your current tax structure? Arrange a non-binding initial consultation with our tax experts now and discover the potential that lies within your company!
Conclusion: Your path to the optimal tax strategy
Tax optimisation is an essential part of financial planning for companies and entrepreneurs. Through targeted tax planning, you can significantly reduce your tax burden and utilise financial resources efficiently. In this blog post, we have explained the basics of tax optimisation, highlighted the differences between tax evasion and legal tax optimisation and presented effective strategies. We have also emphasised the importance of professional support from experienced tax advisors and financial experts to ensure that all measures remain within the legal framework.
Now is the time to take the next steps towards tax optimisation and reduce your tax burden. Working with professional tax advisors offers you the security and expertise you need to minimise your tax burden in the long term. Don’t be put off by the complexity of tax laws – with the right support, you can realise significant financial benefits and ensure the long-term stability of your business.
Don’t hesitate to take the first step! Contact us for a no-obligation initial consultation and discover how you can take your business forward with intelligent tax planning.
FAQ
There are various tax-saving models that companies and private individuals can use to reduce their tax burden:
- Holding company tax-saving model: By establishing a holding company, profits can be distributed within the group in a tax-optimised manner. This makes it possible to retain profits in subsidiaries and utilise the tax advantages there.
- Refinancing model: This model involves the restructuring of financing within a company or group. The aim is to make interest expenses tax-deductible and thus reduce the tax burden.
- Family tax savings model: This involves distributing income and assets within the family in such a way that the tax allowances and lower tax rates of the individual family members are utilised to the full.
Tax optimisation is the legal use of tax structuring options in order to minimise the tax burden. Tax evasion is illegal and involves the deliberate concealment of income or the presentation of false facts to the tax office.
Cross-border tax planning refers to the planning and implementation of tax strategies that involve different countries and their tax laws. The aim is to optimally utilise the different tax rates and tax advantages of the countries involved. This can be achieved by relocating business activities, utilising double taxation agreements and creating international structures.
Companies can realise tax advantages by establishing a holding company. A holding company makes it possible to equalise profits and losses within the group and take advantage of tax benefits such as the intercompany privilege. Dividends distributed by subsidiaries to the holding company are often taxed at a low rate or not at all. Holding structures can also be used to bundle investments and amortise them for tax purposes.
Yes, there are several tax-optimised approaches when buying or selling property:
- Real estate transfer tax: Real estate transfer tax can be minimised by drafting the purchase agreement and making use of real estate transfer tax exemptions.
- Depreciation: Property buyers can use tax depreciation to deduct the acquisition costs for tax purposes over the years.
- Share deals: When selling property, property transfer tax can be avoided by selling shares in a property company instead of the property itself.
Various strategies can be used to optimise property tax:
- Depreciation options: By utilising depreciation options, such as straight-line or declining balance depreciation, the cost of a property can be claimed against tax over the years.
- Listed building depreciation: Properties that are listed buildings offer special depreciation options that can be particularly advantageous.
- Letting and leasing: Income from letting and leasing can be optimised through income-related expenses and operating expenses in order to reduce the tax burden.
