UG & GmbH day to day · 4.8
What is a hidden profit distribution?
Short answer
A hidden profit distribution occurs when your GmbH grants you, as a shareholder, a benefit that it would not grant to an unrelated third party. The tax office adds the amount back to the profit of the GmbH, and it is taxed at your level as a distribution.
Key points
Typical examples:
- The GmbH pays for your private expenses.
- Your salary is unreasonably high or was not agreed in advance.
- You receive a loan from the GmbH without interest or without collateral.
- The GmbH pays you excessive rent, for example for an office in your apartment.
The benchmark is the arm's length principle (Fremdvergleich): Would a prudent managing director grant this to an unrelated third party in the same way? For controlling shareholders, agreements must additionally be made in advance, clearly and in writing, and strictly carried out in practice.
Legal basis
§ 8 Abs. 3 KStG§ 20 Abs. 1 Nr. 1 EStG
Continue
- Next video: Can I lend money to my GmbH or borrow money from it?
- Related: Business Account: How Does the GmbH's Money Reach You?
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