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Taxation for businesses 5min

Taxation for businesses varies for different company types. For example, Limited liability companies and cooperatives are independent taxpayers and they pay corporate taxes, when Private trader, General partnership and Limited partnership pay taxes from the income of their owners. These taxes are generally paid as withholding tax if the company is part of withholding tax register. When issuing a Notice of establishing for your company, you register for the withholding register as well.

If a person has prior tax debts, he might be denied registering to withholding tax register. In this case taxes will be paid according to the tax percentage from entrepreneurs own tax card. Withholding tax is determined by the income of previous years and in the first year by entrepreneurs own estimate. Withholding tax is paid in 2-12 payments and the first payment might come due surprisingly fast, even if you don't have any income yet. If your business is seasonal, it should be disclosed when applying to the withholding tax register, so the taxes will come due when the company has funds to pay them. Withholding taxes can also be paid and adjusted in additional advance payments without extra fees, if it's done within a month after the accounting period ends.

There are also some other taxes companies have to be aware of. Most of the companies are VAT obliged when their revenue is over 10 000 euros in an accounting period. Also an excise tax will have to be paid if a company produces, manufactures or imports certain goods. Excise tax is an indirect tax and eventually the consumer will pay it when it's included in the sales price. For example alcohol, tobacco and soft drink taxes are excise taxes.

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