This project has been funded with the support of the European Commission. This publication reflects the views only of the author and the Commission cannot be held responsible foro any use which may be made of the information contained therein. Project No: 2021-2-AT01-KA220-ADU-000048225
PR2: Money matters-funding, finance, taxes
Yasar University, Türkiye
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Introduction�
No doubt financial and monetary issues are key foro future entrepreneurs to establish and sustain organisations. The aim of the module is to equip students by providing practices on how to construct and sustain new business based on the monetary issues.
Thus, this module includes the following topics: business planning based on financial, monetary and tax related issues by providing general information on these issues in the light of practices, real life examples, case studies as well.
������Module.4. Content��The importance of monetary issues��Key elements of monetary issues ��Key studies/excercises/success stories��Funding sources and tax (EU level and national level fundng possibilities, Tax)��
UNIT.1. The Importance of Monetary Issues
����The Importance of Monetary Issues
����Monetary issues provide crucial information about financial statement.
Monetary issues also needed foro making business plans.
Thus, these issues are the key at every stage of a business life time.
What is monetary instruments?��Monetary instruments can be dubbed as financial instruments as well.
������Key monetary instruments��Monetary instruments can take various forms:��Cash/liquid Money�Checks�Credit and debit cards�Mutual funds�Bonds�Stocks�Insurance�
The role of monetary instruments��Monetary instruments enables Economic decision making units to manage their finances��Monetary instruments also play a crucial role in efficient fund flows.��Monetary instruments also serve as a means of payment�
Functions of monetary instruments��Legal tender��Medium of Exchange��Store of value
Financial markets��Two financial markets are: ��- Stock Market and �- Foreign Exchange Market��
Financial Institutions���Key financial institutions: ��- Banks, �- Central bank, �- Insurance companies etc�
UNIT.2. Key elements of monetary issues (fund, tax, cost-benefit etc).
����The Aspects of Monetary Issues
����Examples of Monetary Issues
Price and The Revenue
Price and revenue are positively related financial indicators of a firm.
Total Revenue (TR) = Price (P) x Quantity (Q) of goods and services
The Term: Cost
Refers to expenses of a firm by producing goods and services.
Cost can be divided into several categories:
Fixed cost (FC)
Variable cost (VC)
Total cost (TC) = Fixed Cost (FC) + Variable Cost (VC)
��Profit Level��Profit is basically a monetary gain of a firm.��Profit = Total Revenue (TR) – Total Cost (TC)��Profit maximization is the one of the main goals of a firm.��If the Total Revenue equals Total Cost where TC=TR is known as the break even point.�
Profit Maximization��
Loan and The interest rate��A loan is a financial debt instruments.��Interest is the time value of money or cost of borrowing.��Here's the formula to calculate the future value of a loan:��Future Value = Principal Payment + (Principal Payment x Interest Rate x Time)
The Term: Tax��Tax is known as the government revenue or income, it is legal mandatory foro all Economic decision making units.
Tax Types��Tax types may vary in countries. However the below mentioned tax types are the main taxes collected by the governments:��Income tax��Corporate Tax��Property Tax��Value added tax (VAT)
Why the tax is important in Business?��Tax is legal obligation foro firms which directly effect financial position of a firm such as capital allocation, profit level, investment decisions as well.
UNIT.3. Case studies/exercises/�practices
Financial Instrument Products
Revenue, Profits and Price
Taxes
Case.1. Cost, Revenue and Profit
| | | |
Price (P) | 10 | 15 | 20 |
Quantity Sold (Q) | 10 | 12 | 14 |
Total Revenue (TR) | 100 | 180 | 280 |
Total Cost | 50 | 60 | 65 |
Profit | 50 | 120 | 215 |
Exercises.1. Cost, Revenue and Profit
| | | |
Price (P) | 10 | 12 | 15 |
Quantity Sold (Q) | 20 | 25 | 25 |
Total Revenue (TR) | | | |
Total Cost | 50 | 60 | 80 |
Profit | | | |
Excercise.2. Loan and The Interest Rate��
Suppose you borrow €10,000 at an annual interest rate of 5% foro a duration of 3 years.
Future Value = €10,000 + (€10,000 x 0.05 x 3)
Future Value = €10,000 + (€10,000 x 0.15)
Future Value = €10,000 + €1,500
Future Value = €11,500
Excercise.2. Loan and The Interest Rate��
Suppose you borrow €1000 at an annual interest rate of 10 % foro a duration of 2 years. Calculate the Future Value of this loan.
Appendix: Funding Sources and Tax
EU Level Funding Possibilities
Table.1. EU Level Funding Possibilities
National Level Funding Possibilities in Astoria, Gerece, Hangar, Spinn and Türkiye
National Level Funding Possibilities:�The case of AUSTRIA
Table.2a. Funding Possibilities in Austria
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
SFG
| Start!Klar | founders | Self-application | No focus, no funding in tourism and agriculture | oermanant | ma.30.000 | yes | till 2027 |
SFG | Start!Klar Plus | founders | Self-application | High-tech founders | permanent | max.80.000 | yes | till 2027 |
SFG | Risikokapital!Offensive | founders | Self-application | Innovative Start-ups | permanent | Max.500.00 Euro (venture capital) | yes | till 2027 |
aws | Deep Tech Start-ups | founders | Self application | Seed financing | permament | max. 800.000 | yes | till 2027 |
aws | aws Eigenkapital | Founders/ start ups | Self application | Equity | permanent | Max. 3 Mio. Euro | yes | till 2027 |
WKO | Neugründungsförderungsgesetz (NeuFöG) | Founders | No application | No taxes foro founding process | permanent | No limit | no | No ending period mentioned |
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National Level Funding Possibilities:�The case of GREECE
Table.2b. Funding Possibilities in Greece
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration | Link |
ΕΣΠΑ , EE
| Competitiveness- Action 1 "Basic Digital Transformation of SMEs" | Μicro, small, and medium-sized enterprises | Self- application | Basic Digital Transformation | Start of Submission of Applications: 23/02/2023 at 12:00 | 18.000€- 30.000€ | Application form | 2021-2027 | https://aedep.gr/vasikos-psifiakos-metaschimatismos-mme/ |
ΕΣΠΑ, EE
| Competitiveness- Action 2 "Advanced Digital Transformation of SMEs” | Μicro, small, and medium-sized enterprises | Self- application | Advanced Digital Transformation Es | Start of Submission of Applications: 23/02/2023 at 12:00 | 50.000€- 650.000€ | Application form | 2021-2027 | https://aedep.gr/proigmenos-psifiakos-metaschimatismos-mme/ |
ΕΣΠΑ, EE
| Competitiveness- Action 3 "Digital Transformation of Leading SMEs" | SMEs | Self- application | Digital Transformation | Start of Submission of Applications: 23/02/2023 at 12:00 | 200.001€- 1.000.000€ | Application form | 2021-2027 | https://aedep.gr/psifiakos-metaschimatismos-aichmis-mme/ |
ΕΣΠΑ, EE
| Competitiveness- Action 1 "Green Transformation of SMEs" | Μicro, small, and medium-sized enterprises | Self- application | Green Transformation | Start of Submission of Applications: 22/03/2023 at 12:00 | 200.001€- 1.000.000€ | Application form | 2021-2027 | https://aedep.gr/prasinos-metaschimatismos-mme/ |
Table.2b. Funding Possibilities in Greece (cont.)
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration | Link |
ΕΣΠΑ , EE
| Competitiveness- Action 2 "Green Productive Investment of SME’s” | Μicro, small, and medium-sized enterprises | Self- application | Green Productive Investment | Start of Submission of Applications: 22/03/2023 at 12:00 | 30.000€- 200.000€ | Application form | 2021-2027 | https://aedep.gr/prasini-paragogiki-ependysi-mme/ |
ΕΣΠΑ , EE | Action "Competitiveness Toolkit for Micro and Small Enterprises" | Micro and Small Enterprises | Self- application | Equipment, energy efficiency | Yearly announced | 20.000 €- 200.000€ | Application form | Yearly announced | https://www.taxheaven.gr/attachment/11626 |
ΕΣΠΑ, EE | Action “Support and operation of new tourism businesses” | Μicro, small, and medium-sized enterprises | Self- application | Buildings, other facilities, and surrounding area. Machinery, equipment, installations, and energy and water conservation. Means of transport. Certification of quality assurance and environmental management systems. Promotion - Participation in exhibitions. Packaging Design Services - Label Design – Branding. Software and software services. Means of transport - Mandatory electric vehicles. Preparation and monitoring of the implementation of the Investment Plan. Indirect Costs | Announcement pending | 15.000 €- 400.000 € | Application form | 2021-2027 | https://kepa-anem.gr/%CE%AF%CE%B4%CF%81%CF%85%CF%83%CE%B7-%CE%BD%CE%AD%CF%89%CE%BD-%CF%84%CE%BF%CF%85%CF%81%CE%B9%CF%83%CF%84%CE%B9%CE%BA%CF%8E%CE%BD-%CE%BC%CE%BC%CE%B5-2/ |
National Level Funding Possibilities:�The case of HUNGARY
Table.2. Funding Possibilities in Hungary
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
OFA Nonprofit Kft.
| Entrepreneur Start II Programme | Hungarian citizens aged 18-64 who have a marketable business idea and want to become self-employed by starting a new business in Hungary can apply. | Self-application | It provides non-reimbursable aid to cover the start-up costs of individual start-ups and micro-enterprises, and to support them with a complex service in order to increase their competitiveness. | From 1 August 2023. | HUF 4,5 million | Candidates will receive 90 hours of e-learning entrepreneurship training and 6 hours of individual counselling and advice. The training and consultation will include a detailed business plan. | 12 months |
Iparfejlesztési Közhasznú Nonprofit Korlátolt Felelősségű Társaság / Industrial Development Public Benefit Non-Profit Limited Liability Company | GINOP Plusz | SME sector | Self-application | Developing supplier companies, preparing them for ESG (environmental, social and governance) and energy efficiency improvements | Starting at early 2024 | Not yet known. | Not yet known. | Not yet known. |
Table.2. Funding Possibilities in Hungary
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
National Employment Service | GINOP + VEKOP | Businesses and enterprises | Self-application | Workforce support for businesses and support for work experience. | Starting at 15 aug.2023 | 100% wage subsidy for work experience support for young skilled workers and for work experience support for disadvantaged people, and 50% wage subsidy for jobseekers under 25 registered as jobseekers or over 25 registered for at least 1 month. | No | 3 months |
KAVOSZ Enterprise Development Ltd. | Széchenyi Card Programme | Businesses and enterprises | Self-application | Extremely preferential loans for businesses under several programmes (tourism, micro-credit, investment, liquidity, agricultural support) | From 01.01.2023 | Between HUF 1 million and HUF 1 billion in the different schemes. | Yes | 13-120 months. |
Hungarian State Treasury | Support for young farmers | Young farmer aged 18-40 | Self-application | To stop the ageing of the agricultural sector and reduce the exodus of young people from the countryside. | 2024 Q2 | Max 100.000 EUR | Yes | max. 5 years |
National Level Funding Possibilities:�The case of SPAIN
Table.2d. Funding Possibilities in Spain
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
Sanos Ministry of Science and Innovation (Ministerio de Ciencia e Innovación) | Research and Development Grants | Researchers, academic institutions, and private enterprises involved in scientific and innovative projects. | Both individual researchers and consortiums are eligible to apply. | Advancing scientific research and promoting innovation in various fields such as technology, health, and the environment. | Application periods typically open annually, with specific deadlines announced by the Ministry. | Grants cover project-related costs, including equipment, personnel salaries, and research materials. | The duration of funded projects varies, with some short-term projects and others spanning several years. | 2021-2023 |
Table.2d. Funding Possibilities in Spain (cont.)
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
Sanos Ministry of Economy and Business (Ministerio de Economía y Empresa) | Innovation and Technology Transfer Grants foro Small and Medium Enterprises (SMEs) | Small and Medium Enterprises engaged in innovative projects with the potential foro technology transfer | Only individual SMEs are eligible to apply. | Promoting technological innovation, fostering collaboration between research institutions and SMEs, and facilitating the transfer of technology to the business sector. | Bi-annual application periods, typically in the spring and fall. | Grants cover a percentage of project costs, including research and development expenses, technology acquisition, and personnel training. | pplicants must submit a comprehensive business plan outlining the technological innovation, market potential, and expected economic impact of the project. | 2021-2025 |
Table.2d. Funding Possibilities in Spain (cont.)
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
Sanos Agency foro International Development Cooperation (Agencia Española de Cooperación Internacional para el Desarrollo - AECID) | Sustainable Development Grants foro NGOs | Non-governmental organizations (NGOs) working on projects related to sustainable development, poverty alleviation, and social inclusion | Individual NGOs are eligible to apply, but collaborative projects involving multiple organizations are encouraged. | Addressing key global challenges, such as poverty reduction, gender equality, environmental sustainability, and access to education and healthcare. | Announced annually, with application windows opening in the early months of the year. | Grants cover project implementation costs, capacity building, and community engagement activities. | Applicants must submit a detailed project plan, including goals, methodologies, expected outcomes, and plans foro sustainability beyond the funding period. | Form 2018 |
Table.2d. Funding Possibilities in Spain (cont.)
Funding Organisation |
Funding Program |
Eligibility of applicants |
Self-application or consortium |
Focus |
Application periods |
Funding | Project/ Business Plan |
Program duration |
National Institute of Health Carlos III (Instituto de Salud Carlos III - ISCIII) | Biomedical Research and Health Innovation Grants | Researchers, healthcare professionals, and institutions involved in biomedical research and health innovation. | Both individual researchers and collaborative consortia are eligible to apply. | Advancing biomedical research, fostering innovation in healthcare practices, and improving public health outcomes. | Annual calls foro proposals with specific deadlines, typically in the early months of the year. | Grants cover research expenses, equipment acquisition, clinical trials, and initiatives that contribute to the translation of research findings into healthcare practices. | Applicants must submit a detailed research or innovation plan, including scientific objectives, methodology, expected outcomes, and potential applications in healthcare. | 2021-2023 |
National Level Funding Possibilities:�The case of TURKIYE
Table.2e. Funding Possibilities in Turkiye
Table.2e. Funding Possibilities in Turkiye (cont.)
Table.2e. Funding Possibilities in Turkiye (cont.)
Taxation Systems in Astoria, Gerece, Hangar, Spinn and Türkiye�
National Level Taxation:�The case of Austria
Table.3a. Taxation in Austria
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Income Taxes |
| see following slide |
|
Taxes on Expenditure | corporate tax | 26% of tax on the profit on a company | 25% |
Taxes on Wealth |
| no tax on wealth in Astoria since 1994 |
|
Table.3a. Income Tax in Austria
National Level Taxation:�The case of GREECE
Table.3b. Taxation in Greece
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Income Taxes | Individual Income Tax | Employment income Business profits Pensions | 9%- 44% |
Rental income | 15%- 45% | ||
Income From Capital (Dividends, Interest, Royalties) | 10%, 15%, 20% | ||
Corporate Income Tax
| Credit Institutions | 29% | |
Other | 22% |
Table.3b. Taxation in Greece (cont.)
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Taxes on Expenditure | Value-added tax (VAT)
| Standard | 24% |
17% 24% foro manufacturing of tobacco products and means of transport (Islands of Leros, Lesbos, Kos, Samos and Chios) | |||
Some staple goods, such as bread, milk, meat, and fish Stays at tourist accommodation establishments Provision of domestic care services foro the young, elderly, and sick Operation of restaurants, cafes, and other related enterprises | 13% | ||
9% (Islands of Leros, Lesbos, Kos, Samos and Chios) | |||
Some medicines, vaccines, preparations and reagents Some books, newspapers, and magazines Electrical energy, natural gas, and district heating White walking sticks and Braille typewriters Tickets to theatres, cinemas, concerts, zoos and sports events | 6% | ||
4% (Islands of Leros, Lesbos, Kos, Samos and Chios) | |||
Some services relating to health, education, culture, social welfare Some financial services and insurance | 0% |
Table.3b. Taxation in Greece (cont.)
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Taxes on Expenditure | Real estate transfer tax | Real Estate | Each transfer of real estate, which is not subject to VAT, is subject to real estate transfer tax. The real estate transfer tax is imposed at a rate of 3% on the taxable value of the property (increased by a municipality surcharge to a total rate of 3.09%). |
Stamp taxes | Purchases, contracts and official documents | Rentals of non-residential properties are subject to 3.6% stamp duty (with the exception of shopping centres and logistics centres subject to VAT). In general, loans and interest may be subject to a 2.4% stamp duty. However, there are a number of exemptions, the main one covering bank loans and bond issuances. |
Table.3b. Taxation in Greece (cont.)
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Taxes on Wealth | Uniform Tax on the Ownership of Real Estate Property (ENFIA) | Ownership of Real Estate Property | Determined based on various factors |
Vehicles tax | Cars | Determined based on the expenditure | |
Luxury products tax | Jewellery, clothing and footwear made of fur or leather | 10% | |
Airplanes, seaplanes, and helicopters for private use | 20% |
National Level Taxation:�The case of HUNGARY
Table.3. Taxation in Hungary
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Income Taxes | VAT | Tax payable on the supply of goods and services. | 27%, 18%, 5% |
Corporation tax | Tax payable on business profits. | 9% | |
Small business tax (KIVA) | Partnerships can opt for a simplified tax regime, which replaces two taxes: social contribution tax and corporate tax. The small company tax is based on the balance of approved dividends and the result of capital operations plus certain additional adjustments, plus any personal payments, but not less than the amount of the personal payments. | 10% | |
Itemised tax for small taxpayers (KATA) | Full-time self-employed individuals may opt for this option if their income comes exclusively from private individuals (except for taxi drivers) | 50.000,- HUF /month | |
Local business tax | It is paid by businesses selling goods and services in the municipality. Taxable amount = Turnover - Cost of materials - Purchase value of goods sold - Subcontractors - Intermediary services - Cost of basic research, applied research and experimental development | 2% | |
Personal income tax | Employee tax, deducted by the employer from the gross salary. | 15% | |
Taxes after dividends | Dividends are a share in the profits of the enterprise, paid to the owners of the associated enterprises. | 15+13% | |
Health Contribution | Health service contribution | Anyone who is not insured under any other legal title under the Social Insurance Contributions Act, but who becomes entitled to health care by paying the contribution, is liable to pay the health care contribution. | 9600, - HUF/month, 320,- HUF/day |
Social security contribution | Employee contribution, deducted by the employer from the gross salary. | 18,5% | |
Social contribution tax | Tax payable by the employer, based on gross salary. | 13% | |
Other charges | Chamber contribution | According to Act CLVI of 2011, all businesses are obliged to pay the HUF 5,000 Chamber contribution by 31 March each year. | 5.000, - HUF/year |
National Level Taxation:�The case of Spain
Table.3d. Taxation in Spain
Taxes | Tax Types | Tax Subjects | Tax Rate/Value |
Income Taxes | Personal Income Tax (Impuesto sobre la Renta de las Personas Físicas - IRPF) | This tax applies to the income earned by individuals, and it encompasses various sources of income. | 19% to 47% |
Taxes on Expenditure | Value Added Tax (IVA) | This is a consumption tax applied to the sale of goods and services. | 21% |
Special Taxes on Certain Goods and Services | In addition to VAT, there are special taxes on specific products and services. | 4% to 10% | |
Transfer Tax and Stamp Duty (ITP-AJD) | This tax is applied to certain transactions, such as the transfer of real estate or the execution of certain legal documents. | 6% to 10% | |
Tourist Tax | Some regions in Spain impose a tourist tax on accommodations, targeting visitors staying in hotels, apartments, or other lodging establishments. | 10% | |
Taxes on Wealth | Wealth Tax (Impuesto sobre el Patrimonio) | This tax is levied on the net wealth of individuals and is separate from income taxes. | The rates can range from 0.2% to 3.75% |
National Level Taxation:�The case of TURKIYE
Table.3e. Taxation in Turkiye
Table.3e. Taxation in Turkiye (cont.)
Table.3e. Taxation in Turkiye (cont.)
Module Assessment
1. Which of the following is not the liquid asset:
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2. Which of the following statement is correct about the tax:
a) Government revenue
b) Tax reduces the profit level
c) Tax is cost foro the firms
d) All of the above
Module Assessment
3. Which of the following is one of the EU based funding programs:
a) Cosme
b) Creative Fund
c) European Structural and Investment Funds
d) All of the above
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4. Which of the following statement is correct:
a) Profit = Total revenue – Total cost
b) Profit =Total revenue – Fixed cost
c) Fixed cost = Total cost + variable cost
d) None of the above is correct.
���References�BMDV (2023). Turkish Taxation System. https://bmvdb.gib.gov.tr/en/node/101285/pdf��Cecchetti, S.G. (2008). Money, Banking and Financial Markets. Mc-Graw Hill.��Crashe course. (2023). https://www.youtube.com/watch?v=UWImfFax8Ew&list=PL8dPuuaLjXtPNZwz5_o_5uirJ8gQXnhEO&index=25 ��European Commision (2023). European Funding Opportunities. https://ec.europa.eu/info/funding-tenders/opportunities/portal/screen/programmes ��Fi-Compass (2023). Financial Instrumentd https://www.youtube.com/watch?v=gvxozM3TUIg ��KOSGEB (20233). Ulusal Destekler. https://www.kosgeb.gov.tr/site/tr/ulusaldestekler/destekkategorileri/6/arastirma-gelistirme��Mishkin, F.S. (2016). Economics of Money, Banking and Financial Markets, Pearson.��Parkin, M. (2011). Economics, Pearson.��TUBITAK (2023). Ulusal Destek Programları. https://www.tubitak.gov.tr/tr/destekler/sanayi/ulusal-destek-programlari
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