The German Annual Tax Act 2024 has reformed the VAT exemption for educational services in accordance with sec. 4 no. 21 of the German VAT Act. This amendment took effect as of 1 January 2025. On 17 January 2025, the Federal Ministry of Finance published a draft of an application letter on the new legal regulation. This draft confirms the Ministry’s letter of 29 April 2024 and thus the VAT liability for many online educational offers. An exception to the VAT liability, in the digital education sector, is to apply to courses that are approved under the Distance Learning Protection Act. This is an issue that has been previously neglected but is now being given an unprecedented level of attention. As serious legal consequences may arise from non-compliance, affected course providers must urgently become familiar with this topic.