From a tax point of view, a rental of assets to your own GmbH seems to be tax-optimal. Because the objects remain part of the private assets and can be sold at first glance tax-free according to § 23 EStG.

But: The rental to your own GmbH can lead to a so-called division of operations with serious disadvantages. Because all assets of the private assets are then to be invested in a newly founded ownership company. If the rental ends, all hidden reserves are taxed – including those that would be tax-free without a business split, for example according to § 23 EStG.

In German income tax law, a fundamental distinction is made between business and private assets. Corporations such as the GmbH have only operating assets, since they cannot establish a private area of life due to their status as legal persons. This leads to the fact that all economic goods – for example vehicles and buildings – are always attributable to the company’s operating assets when they acquire them.

It is different for private individuals. When a natural person acquires an asset, it is attributed either to the assets of a sole proprietorship or to private assets. If there is no sole proprietorship and thus no business assets, the acquired asset belongs to the (necessary) private assets.

Pure rental usually leads to income from rental and lease (§ 21 EStG) or other income (§ 22 no. 3 EStG). The leased assets then remain private assets, which allows a tax-free sale under the conditions of § 23 (1) EStG.

These principles generally also apply when renting to your own GmbH. It distinguishes the private assets of the natural person from the business assets of the legal person. The company can use the transferred assets, but at the same time – unlike in the case of an allocation to the operating assets of the GmbH – a tax-free sale by the natural person is possible.

Sounds too good to be true? Unfortunately, the Bundesfinanzhof (BFH) has already made this statement and developed the legal institute of the so-called division of operations. Under manageable conditions, the legal consequences can be serious if the division occurs unnoticed.

In principle, the rental to the own GmbH is tax harmless, provided that the Managing Director has subscribed in the articles of association the prohibition of so-called business transactions (§ 181 BGB). As a result, it is possible to conclude transactions “with yourself” under civil law, i.e. between the company and the natural person behind it as a shareholder.

Note: The BFH has already stated in several decisions that a division of operations can also occur if the prohibition of self-sufficiency has not been withdrawn (inter alia judgment of 28.) May 2020, IV R 4/17.

A profit-tax business split only arises if two central requirements are met: