In a recent judgment the Supreme Tax Court decided that the requirements for an invoice within the meaning of Section 14c (2) Value Added Tax Act (VAT Act) are fulfilled if the document contains the issuer of the invoice, the (presumed) recipient of the service, a description of the service, the remuneration, and information on the VAT shown.
In April 2024, the tax authorities commented on the VAT implications of online event services. This administrative circular has now been revoked and replaced by a revised circular issued most recently by the Ministry of Finance (MoF). The VAT Act Application Ordinance was adjusted accordingly.
here an entrepreneur undertakes to enter into a tenancy (landlord and tenant) for a consideration, the supply is tax exempt according to Section 4 No. 8 (g) VAT Act.
The German Federal Ministry of Finance has commented on the changed requirements for intra-community supplies resulting from the Act on Further Tax Incentives for Electromobility and on the Amendment of other Tax Regulations – Finance Act 2019: “FA 2019” - amending the VAT Act Application Ordinance accordingly.
The finance ministry has amended the VAT Act Implementation Decree to reflect the change in the law to treat exhibition charges to foreign businesses as a service rendered in the country of the recipient.
The Münster Tax Court has rejected an earlier decree of the Federal Ministry of Finance according to which entrepreneurs based abroad who own a rented property located in Germany are treated as being resident in Germany if the otherwise exempt rentals are subject to VAT by way of a waiver pursuant to Section 9 VAT Act.
According to a decision of the Supreme Tax Court the author of works of art for the purpose of the reduced VAT rate as provided in Section 12 (2) No. 13 VAT Act is the (intellectual) creator of the work and not his or her successor in title. The question of authorship for VAT purposes must be answered in accordance with the provisions of the Copyright Act.
According to the Supreme Tax Court, the subsequent correction of invoices does not have retroactive effect considering the requirements laid down in Section 14a (7) VAT Act regarding the additional obligations on the issue of invoices for intra-Community triangular transactions. This decision is a follow-up on an earlier judgment of the European Court of Justice from 2022 in the case C-247/21 Luxury Trust Automobil.
According to a recently published decision of the Supreme Tax Court a so called “fairness compensation” which is paid by a TV station to the screenwriter based on the specific provisions in the German Copyright Act is subject to VAT as remuneration from a third party within the meaning of Section 10 (1) sentence 3 of the German VAT Act.
Is the supply of services by independent groups of people to their members VAT free without distorting competition? The European Court of Justice has commented on this issue in a request for a preliminary ruling from Spain regarding VAT exemption for municipal cost-sharing schemes. The judgment also has implications for the corresponding German exemption in Section 4 No. 49 of the Value Added Tax Act (VAT Act).
In two most recently published decisions the Supreme Tax Court commented on the VAT situation in the event of the sale of a business which is not turnover within the meaning of the VAT Act under certain circumstances. The court denied VAT exemption in both cases, namely where - after the sale - the business is continued by the lessee and where facilities in a solar park are transferred to various purchasers while continuing to feed electricity into the grid.
Towards the end of 2024 the Federal Ministry of Finance (MoF) commented in some detail on the input VAT deduction for credit institutions. The ministerial pronouncement focuses on the attribution of input transactions to output transactions and the relevant input VAT allocation in accordance with Section 15 (4) VAT Act. Another focus of the MoF circular is on cross-border structures and specifically the services between local branches and their foreign head office and vice versa.
Services are provided to a bank operating automated teller machines (ATMs) which consist of setting up and maintaining these machines, replenishing them with cash and equipping them with hardware and software for reading the cash card data, forwarding authorisation requests for cash withdrawals to the bank which issued the cash card used, making the desired cash withdrawal and registering withdrawal transactions are not tax exempt supplies with the meaning of Section 4 No. 8 letter d of the VAT Act. This was the finding of the Supreme Tax Court on 13 November 2019, published on 19 December 2019.
The Supreme Tax Court has held that the mail order provision in the VAT Act cannot be avoided by having the customer formally request the foreign supplier to arrange for transport on his behalf.
The PwC VAT Newsflash deals with the overhaul of the provisions of the German VAT Application Guidelines about the VAT treatment of travel services, following an amendment of the respective provision of the German VAT Act and considering the latest case law.
The Swiss Federal Tax Administration is currently preparing an amendment to the Swiss VAT Act as of 1 January 2025 regarding the VAT treatment of the supply of goods via online platforms. In addition, and in order to finance the local pension system, the standard VAT rate shall increase further.
In a most recent judgment, the Supreme Tax Court held that bribes confiscated under criminal law reduce the VAT basis of the respective turnover affected under criminal law. A tax that has already been assessed must be corrected at the time of collection in accordance with Section 17 (1) sentence 1 VAT Act.
Similar to a VAT inspection pursuant to Section 27b of the German VAT Act, the review of the cash-system (here: at a restaurant business) does not require prior notice or the specification of reasons. This was decided by the Hamburg Tax Court. In addition, the court held that the cash inspection allows an automatic follow-up tax audit if warranted by the facts determined during the cash inspection.
In a most recent circular, the Federal Ministry of Finance (MoF) has commented on the input VAT deduction from services obtained by an entrepreneur prior to the switch from the standard taxation to taxation under the small business regime in Section 19 of the German Value Added Tax Act.
