What happens in the case of negative income from services?

If you incur negative income from services, losses can be offset against profits from similar income in the same year. A clear profit-making intention is required. Otherwise, the losses are not deductible – but the income is also not taxable.

Loss offsetting: carryback and carryforward

Loss carryback

• Losses can be offset against profits from the previous year.
• This retroactively reduces taxable income.

Loss carryforward

• Alternatively, they can be offset against profits in subsequent years.
• This reduces future taxable income.

New regulations from 2024 (Growth Opportunities Act)

Since 01.01.2024, the following maximum amounts apply:

• Loss carryback: up to one million euros (individuals), two million euros (married couples)
• Loss carryforward: up to one million euros or two million euros fully deductible
• Amounts exceeding this:
  • 2024–2027: Deductible up to 70 per cent of income
  • From 2028: Only 60 per cent deductible

Legal basis: § 10d para. 2 EStG, amended by the Growth Opportunities Act of 27.03.2024

Limited options since 2022

Since 2022, only a full waiver of the loss carryback is possible. A partial carryback is no longer permitted.

Conclusion

Negative income from services can still be used for tax purposes – through carryback or carryforward. From 2024, the following apply:

• Carryback: up to one million euros or two million euros (married couples)
• Carryforward: fully deductible up to these amounts, above that 70 per cent (from 2028 again 60 per cent)