A home-based business can be many things — selling aroma candles, kitchen containers or skin care products. Whatever your preference, you have to follow German and military policies for your home-based business.
Before beginning a business, the owner must contact the installation commercial affairs officer. He or she can provide details about local policies and help operators gain permission from the garrison commander for the business.
On the German side, a small business will first need to be registered. Then it can be determined whether it will be subject to taxation by German authorities. It is highly recommended that people operating a business out of their home consult a legal professional. On top of that, a business may need an entry in the register of companies and other licenses.
From a customs angle, the first point to note is that U.S. forces plated vehicles are for personal use only. Using one as part of a business is illegal.
“Examples of abuse would be if you used your U.S. Army Europe-plated van to deliver goods to customers, transport children as a child care provider or import pottery from Poland for resale,” said Tim Sellman, director of the U.S. Army Europe Customs Executive Agency.
He advises business owners to register their business vehicle in the German system to be legal.
The second point is that mail that is sent or received as part of a business must go through a commercial shipping company or the German postal service. The Army Post Office system is an entitlement for personal use and using it to send or receive business wares and letters is not allowed.
Third, business owners must declare any goods intended for resale to German customs when bringing them into the country.
“If you buy commercial items in other countries, you must stop at the border and tell German customs your goods are for resale,” Sellman said.
Business owners may not use AE Form 550-175A, Import/Export Certificate & Purchase Permit, to avoid paying duty.
Goods sold in the commissary, post exchange, and AAFES catalog are tax-free so business owners cannot buy anything there for a business. Examples could be a computer for running the business or baking supplies for a cake enterprise. Not surprisingly, using VAT forms to support a business is off-limits too.
People who don’t follow the rules risk receiving a hefty fine and tax demand from German authorities, and military administrative or civilian misconduct action as well, where applicable. Here are the main points again:
- Do not use tax-free gasoline or a U.S. Army Europe plated POV for business activities.
- Do not use the military postal service to send or receive any business-related materials or mail.
- Do not use customs entitlements to import or export merchandise, advertising materials or other business-related materials.
- Do not use any item bought in the PX or commissary for a business.
- Do not use VAT forms for any item intended for commercial purposes.
- Do not use Family and Morale, Welfare and Recreation facilities, such as photo or craft shops, to support a business.
- Do not store merchandise in government quarters or use them as a showroom.
Almost all business-related income must be reported to both German and American tax authorities.
Contact the installation commercial affairs officer at (0611)143-548-1003 and download the pertinent directive, Army in Europe Regulation 210-70 (On-Post Commercial Solicitation), for further information.