Germany: Small Business VAT Exemption (Kleinunternehmer) — Thresholds as of Jan 2026

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TL;DR (2026)

You can use the small business VAT exemption if:

• your 2025 turnover ≤ €25,000 (net), and
• your 2026 turnover stays ≤ €100,000.

Important: the transaction that pushes you over €100,000 becomes VAT-taxable (standard VAT applies from that point).

If you exceed thresholds

• Exceed €25k in 2025 → generally not eligible in 2026.

• Exceed €100k during 2026 → switch mid-year from the crossing transaction onward.

• Kleinunternehmer Check

• Freelancer Tax Tool

• (Optional) E‑Rechnung Guide 2026

Sources

• German Ministry of Finance (BMF) guidance on updated §19 UStG (18 Mar 2025)
• IHK / Finanzamt notes on 25k/100k and "crossing sale is taxable"

Frequently Asked Questions

What are the current thresholds (2026)?

• Previous year (2025): Net revenue must be ≤ €25,000
• Current year (2026): Net revenue must stay ≤ €100,000
• Both conditions must be met to use the small business regulation.

What happens if I exceed €100,000 during the year?

The transaction that pushes you over €100,000 becomes VAT-taxable. From that point forward, you must charge standard VAT (19% or 7% depending on goods/services) and can no longer use the small business exemption.

Can I switch back to small business status later?

No, once you exceed the threshold in a year, you cannot use the small business regulation for that year. You can reapply in future years if you stay under the thresholds again.

Do I need to add a notice to my invoices?

Yes, if using the small business regulation, you must add: "Gemäß §19 UStG wird keine Umsatzsteuer ausgewiesen" (According to §19 UStG, no VAT is shown).

What counts as revenue?

All net revenue (excluding VAT) from your business activities. This includes sales, services, and other business income. Business expenses are not deducted from revenue for threshold calculations.

Can I voluntarily register for VAT?

Yes, you can voluntarily register for VAT even if you qualify for small business status. This allows you to reclaim input VAT but requires you to charge VAT on all sales.

How do I check if I'm eligible?

Use our Kleinunternehmer Check tool to verify your eligibility based on your revenue figures and business situation.