What is a legal entity number

The economic identification number comes

The business identification number is the Berlin airport of the financial administration. It is necessary. It can be useful. She will finish. Sometime.

  1. What is the economic identification number used for?
  2. Does the identification number replace the tax number?
  3. Who will receive the business identification number?
  4. Where can I get the identification number from?
  5. When does the business identification number come?

As early as 2003 it was decided that it makes sense to be able to better distinguish between private and business matters in tax matters. That is why every company, including lone workers and freelancers, should be given a special tax number for business purposes. That is the Economic identification number.

What is the economic identification number used for?

There is a tax identification number for the private sector. Everyone has already received it, and there is one per person. In the long term, it will replace the old tax number for income tax returns.

With the business identification number, the commercial tax numbers, which in part only applied to individual types of tax, are to be summarized and clearer. The sales tax ID, for example, becomes superfluous. Each company then has a number for all types of tax. It does not matter whether the company is a legal person or a partnership or only consists of a natural person. The Federal Central Tax Office (BZSt) in Bonn is responsible for issuing the W-IdNr.

What's the idea behind it?

A unique business identification number is useful, it helps entrepreneurs and shareholders as well as their tax advisors. But - according to the plan - it also makes the work of the tax offices easier, because less complicated assignment makes it easier for these authorities to keep track of data.
In a nutshell: easier, clearer and, in the end, fairer too it should be. That’s the theory.
Since then, companies and offices have been waiting for the start. But it's like the Berlin airport: complicated.

Does the identification number replace the tax number?

The regulations for the tax identification number and the business identification number were specified in 2003 by the Tax Amendment Act. The legislator has set this down in the course of changes in the tax law in the tax code § 139 a to § 139 d AO. The business identification number is therefore compared to the tax identification number (tax ID number).

Retailers and freelancers receive an additional identification number in addition to their personal identification number Economic identification number. This is intended to clearly separate operational areas from private areas.
In addition, the business identification number takes on the function of the sales tax identification number. The W-IdNr. will have the same format as the VAT identification number with the letters DE and another 9 digits. Companies that already have a VAT ID no. have to use them as economic identification numbers after the introduction has come into force.

Who will receive the business identification number?

While the tax legislator assigns the normal identification number to all taxable natural persons, the economic identification number should only go to economically active persons, such as companies. In terms of tax legislation, economically active persons include:

  • natural persons with economic activity, such as freelancers or retailers
  • legal persons
  • Associations of persons
  • Entrepreneur
  • employer

The identification feature is intended to replace the previous tax numbers for the various types of tax once it has been assigned to companies. Companies that receive an economic identification number must use this for their identification with the tax office. The use of the previously conducted Tax identification number and especially the Sales tax identification number is omitted.

Identification number - where can I find it?

The Federal Central Tax Office is responsible for issuing the economic identification number. It not only assigns every taxpayer who is a natural person the tax identification number that they must use for their communication with the tax authorities about applications, declarations or notifications. The Federal Central Tax Office is also responsible for determining and distributing the business identification number for economically active persons.

Where can I get the identification number from?

Entrepreneurs do not have to take action to obtain their business identification number. The Federal Central Tax Office forwards an economic identification number to a competent tax authority as soon as it requests the number. The tax office then informs the company, the self-employed, freelancer or retailer that they have a Economic identification number was assigned and what it is. An application from the taxpayer to obtain the business identification number is therefore not required.

When does the economic identification number come?

The economic identification number is currently (as of 2018) not yet assigned. The Federal Central Office is faced with an extremely complex task with the assignment of the number system.

In addition, many other bodies are involved in the work on the introduction of the business identification number. Therefore, the introduction of this special identification number will take some time. According to the Introductory Act to the Tax Code, Art. 97, Section 5 EGAO, the Federal Ministry of Finance, together with the approval of the Federal Council, will determine the point in time when the statutory ordinance for the allocation of the economic identification number comes into force. This means that the introduction of the identification number for entrepreneurs is not yet up to date. The public will be aware of the date of Activation and assignment of the business identification number be informed.