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VAT News 27/2014
Input VAT deduction: invoice correction with retroactive effect?
The tax court Niedersachsen referred to the ECJ the question of whether and, if so how, the correction of invoices can be carried out retroactively. If a VAT deduction is denied vis-à-vis the faulty invoice and is granted for the corrected invoice, it would be a “zero-sum game” if it were not for the additional late payment interest in the amount of 6%. However, interest payments would be omitted if a retroactive correction of the invoice was permitted.
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VAT News 26/2014
Installed operating equipment is not immovable property
The Federal Fiscal Court has ruled that installed operating equipment is not immovable property. This is the case irrespective of whether it is constantly affixed to the property or not. In the case at hand, the court was faced with making a decision concerning the reverse charge scheme in the construction sector. However, it also came to a number of general conclusions that may be relevant for the definition of services connected to immovable property. The German Administrative Circular will have to be amended accordingly. Companies performing and receiving supplies related to machines and equipment will have to review the VAT treatment and amend said treatment, if need be.
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VAT News 25/2014
Last recipient not obliged to correct input VAT deduction
The last recipient in a supply chain is not obliged to correct his input VAT deduction if he receives rebates from a manufacturer not resident in Germany. This is based on a judgment of the German Federal Fiscal Court. However, what is not yet decided is the reverse: Is it possible that the manufacturer resident in Germany corrects his output VAT if he grants rebates directly to the last recipient not resident in Germany and if VAT is due for the supply of goods to his customer in Germany?
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