"Which insurance can I deduct from my tax?"
Private individuals and the self-employed require very different types of insurance coverage. This also applies to the costs incurred and tax claims. Anyone who maintains insurance as a self-employed person must pay attention to a few things with regard to tax deductibility. Which insurance can be deducted from the tax as a self-employed person depends on whether they are related to the business activity.
As a self-employed person, it is important to know which types of insurance can be tax deductible. Because a major advantage of self-employment is to reduce the tax burden through business expenses.
Which insurances can a self-employed person deduct from tax?
As a self-employed person, you are exposed to comparatively higher risks than other taxpayers. A large number of these risks can be regarded as threatening the very existence of the company.
- Self-employed persons can protect themselves by taking out special insurance. Which these are cannot be decided in every case. In some cases, such insurance is required by law.
- Some professional groups, such as tax consultants, lawyers and auditors, have to take out property damage liability insurance. Because mistakes in advice or legal representation often and quickly lead to high financial losses. This is a special form of company liability insurance.
- The usual public liability insurance policies required by the majority of the self-employed only cover risks of personal injury and property damage. Financial losses are not covered here.
- The contributions for business liability insurance are undoubtedly deductible as business expenses. In the case of insurance packages that include the protection of private risks, this portion must be separated from the operational expenses.
The answer to the question of which insurance can be deducted from tax ...
Deduction of insurance premiums as business expenses
- The self-employed can always successfully claim and deduct the entire insurance premium from tax if the insurance covers the purely operational risk.
- Self-employed persons can assume this with the insurance companies listed below. The name of the insurance already makes it clear - such as business interruption insurance, operational Liability insurance or company fire insurance as well as company bad debt insurance - the use in operational area.
- Self-employed entrepreneurs can deduct the contributions of a statutory accident insurance taken out for their company from tax. The contributions must always be paid to the respective professional association. This turns them into business expenses.
- The tax office can only partially recognize insurance contributions as business expenses if there is no clear separation of professional and private insurance. It is usually estimated which insurance premiums are not deductible. That is certainly not to the advantage of the self-employed.
In any case, the operating expenses do not include the costs of private liability insurance, private health insurance, pension insurance and life insurance. A tax claim is possible under certain circumstances as special expenses.
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