Business asset comparison

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The business asset comparison (BVV) (also inventory comparison ) is a tax law method of determining profits . A distinction is made between the complete and the incomplete comparison of business assets.

Business people who are required to keep accounts determine their profit in accordance with Section 5 EStG (complete comparison of business assets).

In accordance with Section 4 (1 ) EStG (incomplete comparison of business assets) determine your profit

  • Farmers and foresters who are required to keep accounts or who are not required to keep accounts and who submit an application in accordance with Section 13a (2) EStG
  • Self-employed who voluntarily keep books as well
  • Tradespeople who are not required to keep accounts and who do not voluntarily keep books, but who are valued as a result of missing records in accordance with Section 4 (1) of the Income Tax Act.

The comparison of business assets requires a period-based profit determination by double bookkeeping ( balance sheet , profit and loss account , cash book , inventory ). The profit results from: 

   Betriebsvermögen am Ende des Wirtschaftsjahres
-  Betriebsvermögen am Ende des vorangegangenen Wirtschaftsjahres
=  Betriebsvermögensänderung (Zunahme oder Abnahme) bzw. Gewinn

   Betriebsvermögensänderung (Zunahme oder Abnahme) bzw. Gewinn
+  Entnahmen des Wirtschaftsjahres
-  Einlagen des Wirtschaftsjahres
=  Gewinn / Verlust

The tax concept that is decisive for this type of profit determination is known as the net wealth access theory and is based on the increase in assets within a certain period of time as taxable income, while excess income ( Section 2 (1) sentence 1 no. 4 to 7 EStG) is the so-called Source theory is based.

See also