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Umsatzsteuer Newsletter 24/2020
The relevance of the planned Association Sanctions Act for tax compliance
On 16 June 2020, the Federal Government presented the draft of the planned law on sanctions for associations. The core of the new legislation is the sanctioning of companies for offences committed in the course of their business activities. These also include tax evasion, insofar as it was committed for the benefit of the respective company. In contrast to the current legal situation, the criminal prosecution authority will conduct sanction proceedings against the company in addition to the criminal proceeding against the suspected persons. Even if the new regulation still leaves many questions unanswered, it is, nevertheless, to be welcomed that compliance measures taken by companies, as well as efforts to clarify legal violations will be taken into account in a mitigating manner. As a result, a functioning Tax Compliance Management System can thus significantly mitigate or even completely avert a sanction against a company.
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Umsatzsteuer Newsletter 23/2020
Update on VAT rate reduction: Non-objection rule gives businesses one additional month for implementation of necessary changes
The Federal Ministry of Finance has published an amended draft of an application letter on the VAT rate reduction. This now contains the non-objection regulation in the B2B sector demanded by businesses, albeit for a limited time, it does not equate to the sought after full “low-tax phase”. Although the Ministry confirms that the application of an incorrect (too high) VAT rate will result in unduly charged VAT, the input VAT deduction should still be granted, in full, "for reasons of practicability" and an invoice correction should not be necessary for supplies rendered in July 2020. This gives businesses one additional month for the implementation of necessary changes.
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Umsatzsteuer Newsletter 22/2020
Federal Fiscal Court: Correction of an Invoice – Retroactive Effect to the Detriment of the Recipient
The issue of invoice correction with retroactive effect for the purposes of input VAT deduction has been an ongoing issue in recent years. In a recent decision, the Federal Fiscal Court has prompted this discussion to head off in a new direction. On the one hand, the Federal Fiscal Court held that the cancellation and reissue of an invoice could also have a retroactive effect. On the other hand, a retroactive correction of the invoice could also be made to the detriment of the recipient. The latter might retroactively lose his right to deduct input VAT.
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