The reduction in the self-employment deduction and SME profit exemption in 2025: Is a limited liability company a smart move for the SME entrepreneur?
The self-employment deduction and the SME profit exemption have been additional income tax benefits for entrepreneurs for many years. But these deductions have been increasingly reduced in recent years. In 2025, the amount of the self-employment deduction drops to €2,470 and the SME profit exemption is reduced to 12.7%. It is expected that the self-employment deduction will be only € 900 in 2030.
