VAT Compliance in Germany: An Overview for Businesses
Tax compliance in Germany is fragmentary by nature and requires resources to ensure compliance. Consider that compliance for many German taxpayers requires meeting several mandates, and the fact that such regulations are updated often, and you understand the challenge taxpayers have to undertake. From VAT to IPT, multiple moving parts demand precious time and resources.
This page is your overview of all tax compliance obligations across Germany. To keep up with evolving requirements, be sure to bookmark and revisit frequently.
Table of contents
1. Germany: General VAT information
2. VAT Rules in Germany
3. IPT in Germany
4. Import VAT in Germany
5. Invoicing requirements in Germany
6. Registration for OSS in Germany
7. Registration for IOSS in Germany
8. Intrastat and EC Sales list in Germany
9. FAQ VAT compliance in Germany
10. Help for VAT compliance in Germany
11. Additional resources
Germany VAT compliance can be resource-heavy to stay on top of due to the many requirements imposed on taxpayers. These include:
| Periodic VAT return | Monthly 10th day of the month following the end of the tax period Quarterly 10th day of the month following the end of the tax period |
| Annual VAT Return | Annual 31st May of the year following the reporting year |
| EU Sales and Purchases List | Monthly 25th day of the month following the end of the tax period (for goods once sales pass EUR 100,000 annually) Quarterly 25th day of the month following the end of the tax period (for services and goods when sales are under EUR 100,000 annually) |
| Intrastat | Monthly 10th day of the month following the relevant month |
| VAT rates | 19% 7% 0% and Exempt |
| Intrastat thresholds | Arrivals: EUR 800,000 Dispatches: EUR 500,000 |
VAT Rules in Germany
Germany e-invoicing
E-invoicing is on its way for all taxpayers in Germany, but complete coverage is not here just yet.
Electronic invoicing is currently divided by transaction type. While there are national and federal requirements for B2G transactions, electronic B2B invoices are still not mandated.
Taxpayers may find Germany’s e-invoicing scheme complicated due to its fragmented status, and the fact that more updates are coming. Our dedicated Germany e-invoicing page can help you to meet your compliance obligations.
Requirements to register for VAT in Germany
Companies established within the EU but outside of Germany typically do not have to register for VAT in the country. However, there are exceptions which would require a foreign business to have to register for VAT – including:
- Buying and selling domestically without the goods leaving the country
- Holding products in a German warehouse and selling to German customers
- Importing into and selling goods in Germany from another EU Member State
- Intra-community supplies (moving goods between Germany and other EU Member States)
- Organising live events in Germany – whether for art, education or a conference
- Selling via an electronic marketplace in Germany
More exceptions and other nuanced situations may require VAT registration in Germany. Contact us for more information.
IPT in Germany
Insurance Premium Tax (IPT) is another tax obligation in Germany to consider.
IPT in Germany is complex, providing numerous elements for insurers, brokers and other applicable parties to track – from rates to law changes. Just a handful of years ago, Germany underwent sweeping Insurance Tax Act reforms that caused uncertainty in the insurance market.
Put simply, Insurance Premium Tax is made up of five key elements. Together, the following determine the tax:
- Location of Risk
- Class of Business
- Tax applicability and tax rates
- Declaration and payment
- Additional reporting
Find out more about Germany IPT.
Import VAT in Germany
Import VAT, known as Einfuhrumsatzsteuer in Germany, is a unique form of VAT that foreign taxpayers must know. It is charged by the country’s customs authorities when goods are imported into Germany from countries outside the EU.
Companies established outside of EU Member States must pay import VAT in Germany, including when using ports in Bremen and Hamburg. However, foreign taxpayers oftentimes can apply for reimbursement of import VAT they have paid if they register in Germany.
Invoicing requirements in Germany
German VAT invoices have strict requirements to be legally valid. Required invoice contents include:
- Issuance date
- Unique invoice number
- VAT identification number for the supplier
- VAT rate(s), VAT amount(s), and total gross amount
- Supplier and buyer full addresses
- Description of the goods or services (plus quantities if supplying goods)
- Total value of the invoice
- Details in case of zero VAT, reverse charging, intra-community supply, etc
Registration for OSS in Germany
Cross-border trade in the EU for B2C transactions was simplified with the implementation of the One Stop Shop (OSS) scheme as part of the 2021 EU E-Commerce VAT Package.
To register for OSS in Germany, taxpayers must use the ELSTER.de portal. However, this requires an ELSTER certification, which is given to companies that have registered, paid VAT or submitted a tax return in Germany.
Learn more about OSS with our dedicated overview, or contact us for additional information.
Registration for IOSS in Germany
Devised to simplify EU VAT compliance, the VAT Import One Stop Shop (IOSS) consolidates your intra-EU activities into a single VAT return.
Businesses or their local representatives must submit an electronic application to the BZSt to register for IOSS in Germany. Taxpayers who pay VAT must also specify their VAT registration number.
Read our IOSS overview, or contact our expert team to learn more.
Intrastat and EC Sales list in Germany
Intrastat is an obligation for particular companies that trade internationally in the European Union. Specifically, it relates to the movement of goods across EU Member States.
Despite their being similar enforcements across the EU, Member States have chosen to implement Intrastat rules differently and they each have their own Intrastat threshold that triggers reporting. In Germany, there is a declaration threshold of EUR 800,000 for arrivals and EUR 500,000 for dispatches in 2024.
Find out more with our Intrastat guide.
Frequently Asked Questions
How do VAT returns work in Germany?
Germany issues VAT refunds monthly or quarterly, depending on the business’ filing frequency. The tax authorities transfer the refund to the bank account the business provided when it registered.
What is required on a VAT invoice in Germany?
Germany’s tax authorities require invoices to include specific information, including:
- Supplier name and address
- Buyer name and address
- Issuance date
- Quantity and type of goods and services
- Total invoice amount
- Taxable amount
- VAT payable amount
What is the VAT rate in Germany?
The standard VAT rate in Germany is 19%, applying to most goods and services. There’s a reduced rate of 7% for the likes of books, cultural services, medical and dental care.
What is the VAT registration threshold in Germany?
The VAT registration threshold for taxpayers in Germany is EUR 10,000, providing they haven’t opted to pay VAT in Germany through the EU’s One Stop Shop scheme.
When does VAT liability apply?
In Germany, VAT is due when the tax point occurs. It can be paid from the day after the end of the reporting period to the due date of the VAT return being paid.
Do I need a fiscal representative in Germany?
Germany does not require companies outside the EU to appoint a fiscal representative for tax purposes. Businesses can choose whether to appoint a local representative or register directly with the appropriate tax office in Germany.
What is the tax point for German VAT?
In Germany, the tax point determines when VAT is due. For goods, it is typically the time of delivery. For services, it is when the service is completed.
Where can I get a tax number in Germany?
The tax office automatically sends a tax ID number to newly registered German addresses within three weeks of registration. It will come via mail; a duplicate can be obtained from the Finanzamt.
How high is the delivery threshold in Germany?
The delivery threshold in Germany is EUR 10,000. If a Germany-based supplier delivers goods to a customer in another European company under EUR 10,000, they will pay VAT in Germany as the threshold has not been reached.
How Sovos can help with VAT compliance in Germany
The fragmented aspect of tax compliance in Germany can be demanding on resources, especially when keeping current on future updates and implementations. Sovos is a single vendor with global and local tax expertise that allows you to future-proof your tax compliance.
Choosing Sovos as a partner means choosing to reclaim your time, allowing you to focus on what matters: growing your business.
