Trade Tax Calculator – Business Tax – Gewerbesteuer 2026

Why you can trust us

This page was written and reviewed with German tax rules in mind, including the 3.5% trade tax base rate, municipal Hebesatz, statutory allowances, and the distinction between trade tax and income tax credits.
We use official legal references where relevant and clearly explain when a calculator result is only an estimate.

How to use the trade tax calculator

• Enter your business profit before trade tax.
• Select the correct legal form, because the allowance depends on whether you are a sole proprietor, partnership, association, or corporation.
• Enter the local Hebesatz for your municipality.
• Use the result as an estimate for planning, not as a final tax assessment.

Assessment rates (Hebesatz) of major municipalities

The German trade tax, also known as Gewerbesteuer, is a local tax levied on commercial businesses operating in Germany. It is calculated using the business profit, a fixed base rate, and the municipal assessment rate set by the city or municipality.

A simple way to estimate the effective trade tax rate is: 3.5% × municipal Hebesatz. For example, a Hebesatz of 410% gives an effective rate of 14.35% before any allowance, additions, deductions, or income tax credit.

Trade Tax Calculation

1. Tax base: The starting point is the business profit, adjusted for trade tax purposes. Certain financing costs, rents, leases, and other items may be added back or deducted. For financing-related additions under Section 8 No. 1 GewStG, these rules usually become relevant only if the total relevant financing expenses exceed the €200,000 exemption threshold.
2. Allowance: Sole proprietorships and partnerships with trade income receive a statutory €24,500 allowance. Associations may receive a €5,000 allowance. Corporations do not receive this allowance.
3. Base tax rate: A uniform base tax rate of 3.5% is applied to the adjusted tax base after any applicable allowance.
4. Municipal multiplier: Each municipality sets its own Hebesatz. This multiplier is applied to the base tax amount to calculate the final trade tax due.

Example

Let’s say a sole proprietor or partnership in Berlin has an adjusted profit of €100,000:

• Adjusted profit: €100,000
• Statutory trade tax allowance: €24,500
• Tax base: €100,000 – €24,500 = €75,500
• Base tax amount: €75,500 × 3.5% = €2,642.50
• Berlin Hebesatz 2026: 410%
• Trade tax due: €2,642.50 × 410% = €10,834.25

If the business is a corporation, such as a GmbH or UG, the €24,500 allowance does not apply. With the same adjusted profit of €100,000, the base tax amount would be €3,500, and the trade tax due in Berlin would be €14,350.

Key Points for Businesses

• Who pays trade tax: Trade tax usually applies to businesses with commercial income. Freelancers in liberal professions, called Freiberufler, are generally excluded.
• Local variation: The trade tax rate can vary significantly between municipalities because each municipality sets its own Hebesatz.
• Tax allowance: Sole proprietorships and partnerships with trade income receive a statutory €24,500 trade tax allowance. Corporations do not receive this allowance.
• Tax credit: For sole proprietors and partners in partnerships, part of the trade tax can often be credited directly against personal income tax under Section 35 EStG. Since the 2020 tax year, the credit factor is generally 4.0 times the trade tax base amount (Gewerbesteuermessbetrag), capped by the actual trade tax paid and the owner’s income tax liability. In municipalities with a Hebesatz up to 400%, this can often offset the trade tax in full. Above 400%, such as in Berlin, Hamburg or Munich, a remaining burden may still apply.
• Payment schedule: Trade tax is usually paid in quarterly advance payments.
• Tax advice: Trade tax can become complex if your business has financing costs above the relevant thresholds, mixed freelance and commercial income, multiple locations, or a corporate structure.

Other possible translations you might come across

Business tax: While this is a general term for taxes on businesses, it does not specifically capture the local nature of the Gewerbesteuer.

Municipal trade tax: This is a more descriptive translation but may not be as widely understood as “trade tax.”

Ultimately, the most appropriate translation depends on the context. However, trade tax is the most commonly accepted and understood term.
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Conclusion

The trade tax calculator Germany 2026 helps estimate how much Gewerbesteuer your business may owe. The key factors are your adjusted profit, legal form, trade tax allowance, and local municipal multiplier.

Use the calculator for planning and comparisons, especially when considering where to locate a business. For final tax filings, payment obligations, and legal-form-specific treatment, speak with a German tax advisor.

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