Sustainable investment with tax benefits
CO₂ certificates as business expenses and investments
Hybrid Carbon Certificates (HCC) combine climate protection with financial returns.
They are a new type of carbon certificate. Low-carbon projects generate CO₂ certificates while also providing returns for their holders.
For business owners, they qualify as tax-deductible business expenses (business expense deduction pursuant to Section 4(4) of the Income Tax Act (EStG)). The issuance of CO₂ certificates enables the financing of climate protection projects, and a portion of the proceeds is credited to the holders.
Certified climate projects
Investment in internationally certified CO₂ projects
Project returns
Structured returns from long-term projects
100% tax deduction*
Investment can be taken into account for operational purposes
Possible throughout Europe
Tax optimization for entrepreneurs in the EU, the UK, and Switzerland
What are carbon credits?
Carbon credits are tradable units that represent a specific amount of greenhouse gas emissions that have been avoided or sequestered.
They finance certified climate projects worldwide, such as reforestation, renewable energies, or technologies for CO₂ reduction.
Companies use such certificates to offset unavoidable emissions while supporting projects that make a measurable contribution to reducing global emissions.
Why is this relevant for business owners?
Carbon credits can be more than just a tool for companies to support climate projects; they can also be economically relevant.
Depending on the individual situation, the investment can be taken into account for tax purposes in a business context and thus claimed as a business expense.
At the same time, involvement in climate projects strengthens a company's sustainable positioning vis-à-vis customers, partners, and employees.
Illustrative Example
Illustrative Tax Effect of an Investment
Example for an individual with taxable income of £200,000 when investing in carbon certificates.
01
Initial Position
Taxable Income
£200,000
→
02
Investment
Investment in Carbon Certificates
£50,000
→
03
After Investment
New Taxable Income
£150,000
Illustrative Tax Saving
£24,000
Illustrative tax effect
Capital Effect
£50,000
−
£24,000
=
£26,000
Effective capital invested after tax effect
Illustrative Effective Return
14.23% p.a.
Based on a calculated return on investment of 7% p.a., a 10-year minimum term and an estimated payout of £98,358.
This calculation is provided for illustrative purposes only.
The calculated return on investment of 7% p.a. is not guaranteed.
Actual returns and tax effects may vary depending on individual circumstances and applicable tax regulations.
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The tax deduction generally requires that the certificates be voided by the holder and approved by the tax office.