The fact that employees earn extra income through an ancillary business is becoming more common. Sideline employment occurs when the business only contributes to a small part of the total income. In many cases, it makes sense to initially practice the planned self-employment as a sideline business and only to convert it into the main source of income if successful.
This approach also leads to benefits in the statutory health insurance, as the income from a self-employed secondary occupation in addition to a dependent employment subject to social insurance is not subject to a contribution. Although the benefit of a smaller contribution is the same with pension insurance, it also leads to a reduced pension payment. In the case of a loan for the ancillary industry, the separation between the business account and the private giro account offers itself in principle, even if this is not always realizable.
Consumer credit for the secondary business
In the case of consumer credit, the bank does not ask for the intended purpose, so that these are generally suitable for an ancillary business. When opening an ancillary business, it is possible to justify the processing of the loan through the private giro account, by understanding the loan amount as part of the contributed equity. In the case of loans for an already existing ancillary industry, the inclusion of a consumer loan makes sense, as it is easier to obtain than corporate loans.
In this case, it is advantageous to select a credit contract partner whose budget account not only includes the earned income from the dependent main activity, but also the profit from the ancillary business. The consumer loan as a loan for the ancillary industry, however, emphasizes the preferable separation of the private and the commercial bank account, especially since many online banks as a payment account basically provide the private giro account. A mixture of both accounts is allowed, but easily leads to the tax auditor wants to see not only the business account, but also partially used for business purposes private checking account.
Business loan for the secondary business
The business loan is the ideal loan for an ancillary business. Its award is based less on the personal income situation of the loan applicant than on the profit prospects of the business enterprise. However, regular in-work income from a primary employment is an argument for lending in the case of planned investments in the ancillary industry. In order for the loan-seeker to obtain a business loan, a business plan is necessary for new companies.
If the loan for the ancillary business is to be used for investments in an already existing enterprise, the credit bank asks for which period and to what extent the planned measures lead to profits. Another advantage of business loans, in contrast to consumer loans, is that the agreement of an early redemption free period is much more common. This is useful for the farmer not to repay the loan until the first profits occur. The most important loan for an ancillary business is usually the promotional loan from Intrasavings bank. This also supports start-ups if they are initially or permanently operated as a sideline.
Most of the investment promotion programs for existing companies also have ancillary trades. In addition to the favorable interest rates, the advantage of Intrasavings loans is that the conditions for lending are lower than for most commercial banks. If founders still want to take out a loan for their new ancillary business from a traditional bank, state-owned guarantee banks offer a cheap deficiency guarantee. Particularly regionally active banks and savings banks have frequently launched start-up promotion programs whose terms are comparable to those of the nationwide development bank. Some sectors of the economy, such as agriculture, are not covered by Intrasavings bank’s development loans. However, these have their own development banks, so that any founder can get a favorable loan for the ancillary industry.
Private loans for the ancillary industry
A little known option for borrowing for the ancillary industry offer platforms for private credit brokerage. Privat means in this case primarily that the lenders are invariably private individuals. However, the inclusion of a corporate loan is not excluded on the personal loan platforms. It is important for the credit decision that the applicant describes his business and the planned investments as accurately as possible, since most private lenders pay attention first to their purpose and only secondarily to credit features. They only want to support projects that they agree with in content.
Depending on financial needs, the requested credit for a sideline may require a lender’s subscription or partial credit draw by different members. Settlement takes place in each case via a clearing giro account provided by the platform operator, so that the anonymity of the borrowers and the lenders is maintained despite the extensive information provided in the credit inquiry. Settling the private loan for an ancillary trade via the business account is reasonable and possible.