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Umsatzsteuer Newsletter 26/2024
Federal Ministry of Finance on allocation of goods to the economic activity
Practical and positive developments: In a letter dated 17 May 2024, the tax authorities commented on the allocation of supplies to the economic sphere, as well as on documentation and the documentation deadline for the allocation decision with regard to the current ECJ and German Federal Fiscal Court jurisprudence. According to this, it is sufficient if the tax authorities are informed of objectively recognisable evidence, even after the documentation deadline (standard submission deadline for tax returns) has expired. However, this should be understood as a mere ‘stopgap’ if the documentation deadline has already been missed. The clear recommendation remains: The tax authorities should be informed about the allocation decision, in writing, prior to the expiry of the deadline.
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Umsatzsteuer Newsletter 25/2024
Federal Fiscal Court views chain transactions differently to tax authorities, even in the case of fractional transport
In its recently published decision of 22 November 2023, the Federal Fiscal Court ruled that, contrary to the opinion of the tax authorities, a chain transaction is also deemed to exist in the case of ‘broken’ deliveries. The decision relates to the legal situation up to 2019 but should also be applicable by analogy to the current legal situation. Companies are certainly well advised to continue to comply with the German VAT Act and the German VAT Circular. In the event of a dispute, however, the Federal Fiscal Court's findings may prove very helpful.
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Umsatzsteuer Newsletter 24/2024
German Federal Ministry of Finance calls for urgent action on online services
In a letter dated 29 April 2024, the tax authorities issued a comprehensive statement on online events and other online services. According to this, the distinction between pre-produced content and live streaming is not only relevant for the place of supply, but also for the application of the reduced VAT rate, as well as VAT exemptions for educational services and in the cultural and health sectors. Pre-produced educational videos, for example, are no longer exempt from VAT. These far-reaching changes will come into force on 1 July 2024. Hence, there is an urgent need for action. The letter also addresses deemed chains of services and combinations of services. It is therefore also extremely relevant in practice for influencers, streamers and anyone who offers a recording, in addition to live streams.
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