Germany being an EU member state falls under the EU VAT regime. Member states must adopt EU VAT Directives into their own legislation.
Standard VAT Rate: 19%
Reduced VAT Rate: 7%
Registration Threshold Distance Selling: 100,000 €
EU VAT number format: DE999999999
Resident - There is no registration threshold
Non resident - There is no registration threshold
IC Acquisitions - EUR 12,500
In order for a non-resident business to register for VAT, it is necessary to submit the following documents and information to the competent tax office:
power of attorney, if the registration is done by a representative;
articles of association. To initiate registration a copy will be sufficient if the original is filed afterwards;
excerpt from the trade register (or something similar) to prove the legal existence. To initiate registration a copy will be sufficient if the original is filed afterwards;
confirmation of the tax authorities that the head office is registered for VAT purposes. To initiate registration a copy will be sufficient if the original is filed afterwards; and
The process of obtaining a VAT registration number normally takes between three and four weeks from the date on which the documentation is received by the tax office, assuming that there are no complications with the registration and that all information is provided to the tax office at the same time.
Detailed rules regulate reporting requirements of German transactions for Value Added Tax purposes. These include: invoice requirements, timeliness for an invoice to be issued, invoice and credit notes corrections rules, foreign currency reporting requirements and exchange rate sources, correction of previously submitted returns and accounting records that must be maintained for VAT purposes.
Where the VAT due in the previous calendar year is below the threshold of EUR 7.500 (excluding VAT on intra-Community acquisitions) the tax period is the quarter. Where the VAT due in the previous calendar year is below EUR 1.000 VAT returns can be filed on a annually basis if the tax office agrees. Otherwise, returns must be filed monthly. Monthly returns must also be filed by newly created business for the two first calendar years of business activity. Additionally to the monthly or quarterly returns, an annual return has to be submitted.
The time limit for filing the VAT return is 10 days for the monthly and quarterly return. A permanent time prolongation of one month can be applied for. In case of monthly submission, this requires the payment of a so-called special prepayment which is set off against the VAT liability of December. The amount is calculated by 1/11 of the VAT due in the previous year. The annual return must, in general, be filed before 31 May of the following calendar year.
Intrastat and EC Sales Lists
The Intrastat discloses details of movements of goods between Member States which take place for commercial reasons, recording the movement whenever goods enter the territory of Germany from other Member States or leave it to other Member States.
Declaration must be filed monthly once the annual threshold is exceeded.
Intrastat declarations can be submitted electronically and in paper format. The due date for submission is the thenth working day following the reference period. E.g. for the January period, declarations must be submitted by the tenth working day of February.