Based on the so-called Amtshilferichtlinie-Umsetzungsgesetz (AmtshilfeRLUmsG), sections 14 and 14a of the German VAT Act have been amended with effect from 30 June 2013. The circular issued by the Federal Ministry of Finance on 25 October 2013 clarifies some issues and offers some relief for taxable persons.
1. Use of other languages
The invoice statements “Gutschrift” (self-billing),“Steuerschuldnerschaft des Leistungsempfängers“ (reverse charge) as well as the specific references regarding margin schemes can be stated in all EU-languages. In this respect, section II of the Federal Ministry of Finance’s circular contains an overview of the statements in the respective languages.
2. Statement „Gutschrift“ (self-billing)
If self-billing has been agreed, the invoice has to contain the term“Gutschrift” (section 14 para 4 sentence 1 no. 1 of the German VAT Act). The statement “Gutschrift” can also be stated in another language (e.g.“self-billing”). It is not sufficient and in line with section 14 para 4sentence 1 no. 10 of the German VAT Act if other statements are used. However, the input VAT deduction cannot be denied solely based on the fact that another term has been stated on the invoices, provided that the term used clearly shows that the recipienthas issued the invoice document (e.g. “Eigenfaktura”). Furthermore, it is required that the self-billing invoice contains all other invoicing requirements and that there is no doubt that the content of the invoice is correct.
In general, the term “Gutschrift” is also used for invoice corrections and commercial credit notes. If such documents are termed “Gutschrift”, although a self-billing invoice according to section 14 para 2 sentence 2 of the German VAT Act is not given, this is not relevant from a VAT point of view. Furthermore, the Federal Ministry of Finance clearly states that a VAT liability, according to section 14c of the German VAT Act (unduly charged VAT), cannot be assumed based solely on the use of the term “Gutschrift”. Therefore, in general credit notes can be termed “Gutschrift”. However, if a credit note termed “Gutschrift” shows VAT separately, it is recommendable to include a remark stating that the document is not a self-billing invoice according to section 14 para 2 sentence 2 of the German VAT Act.
Furthermore, it is possible that one document is issued for supplies (invoice) as well as for purchases (self-billing). In that document the term “Gutschrift” has to be stated. Moreover, the document has to show clearly regarding which supplies the issuer is considered to be the supplier and regarding which supplies he is issuing a self-billing invoice. It is not permitted to offset the respective supplies. This means that the taxable amount and the tax amount regarding the supply carried out and the taxable amount and the tax amount regarding the supply purchased have to be stated separately in that document and not only the difference between the rendered supply and the purchased supply.
3. Statement „Steuerschuldnerschaft des Leistungsempfängers“ (reverse charge)
Invoices as well as self-billing invoices, regarding supplies according to section 13b para 1 and para 2 of the German VAT Act, for which the recipient owes the VAT, must contain the remark “Steuerschuldnerschaft des Leistungsempfängers”. This remark can also be stated in other languages (e.g. “reverse charge”).
The Federal Ministry of Finance confirms that it is not a precondition for the deduction of input VAT based on supplies according to section 13b of the German VAT Act that the recipient is in possession of an invoice meeting the invoice requirements according to section 14, 14a of the German VAT Act. This means that the customer is entitled to an input VAT deduction even if the remark on the reverse charge is incorrect or missing.
4. Point of time to issue invoices
Invoices regarding intra-Community supplies (section 14a para 3 sentence 1 of the German VAT Act), as well as cross-border services, (section 14a para 1 sentence 2 of the German VAT Act), are to be issued by the 15th day of the month following the month in which the transaction has taken place. If this deadline is not met, this will not result in an administrative offence according to section 26a of the German VAT Act.
However, it should be noted, that an administrative offence, according to section 26a para 1 no. 5 of the German VAT Act will be committed if the EC-sales list is not filed in due time or is incomplete. In practice, intra-Community supplies or cross-border services can only be declared in the EC-sales lists if the respective invoices have been issued. Otherwise, the invoices would not be covered by the automatic reports from the EDP-systems. As a consequence, the issuing of invoices by the 15th of the following month, ensures that the EC-sales lists are filed correctly and in due time.
5. Non-objection provision
With regard to invoices which are issued by 31 December 2013, no objection will be made to these invoices if they do not contain the statement “Gutschrift” or the remark “Steuerschuldnerschaft des Leistungsempfängers”. The said invoices will also not be objected to if they do not meet the requirements according to section 14a para 6 of the German VAT Act (specific regulation for margin scheme).
Contact:
Eveline Beer
Lawyer, Certified tax consultant
Phone: +49 (0)89 / 217 50 12 - 35
eveline.beer@kmlz.de
As per: 13.11.2013
