Germany - VATGermany - VAT
The EU’s VAT system is semi-harmonized. While the guidelines are set out at EU level, the implementation of VAT policy is the prerogative of Member States. The EU VAT Directive allows Member States to apply a minimum 17 percent VAT rate. However, they may apply reduced rates for specific goods and services or temporary derogations. Therefore, the examination of VAT rates by Member State is strongly recommended. These and other rules are laid out in the VAT Directive.
The EU applies Value Added Tax (VAT) to sales by non-EU based companies of Electronically Supplied Services (ESS) to EU-based non-business customers. U.S. companies that are covered by the rule must collect and submit VAT to EU tax authorities. From 1 January 2015, all supplies of telecommunications, broadcasting and electronic services are taxable at the place where the customer resides. In the case of businesses this means either the country where it is registered or the country where it has fixed premises receiving the service. In the case of consumers, it is where they are registered, have their permanent address, or usually live.
As part of the legislative changes of 2015, the Commission launched the Mini One Stop Shop (MOSS) scheme, the use of which is optional. It is meant to facilitate the sales of ESS from taxable to non-taxable persons (B2C) located in Member States in which the sellers do not have an establishment to account for the VAT. In 2021, this service will be extended to cover online sales of goods and services other than ESS.
This (optional) plan allows taxable persons (sellers) to avoid registering in each Member State of consumption. A taxable person who is registered for the Mini One Stop Shop in a Member State (the Member State of Identification) can electronically submit quarterly Mini One Stop Shop VAT returns detailing supplies of ESS or other to non-taxable persons in other Member States (the Member State(s) of consumption), along with the VAT due. The most important pieces of legislation on VAT are the EU VAT Directive 2006/112/EC, as amended, and its Implementing Regulation 282/2011, as amended
Further information relating to VAT on ESS:
https://ec.europa.eu/taxation_customs/business/vat/telecommunications-broadcasting-electronic-services/
VAT in Germany
The standard VAT rate in Germany is 19 percent (below the European average). A reduced 7 percent VAT rate applies to some consumer goods and everyday services (food, newspapers, local public transport, hotel stays). Some services (such as bank and health services or community work) are VAT exempt.
Vendors who are not established in the European Union and who make sales that are subject to German VAT must register for tax purposes in Germany. The tax office Bonn-Innenstadt (Service@FA-5205.fin-nrw.de) is responsible for assessing and collecting VAT for U.S. vendors who are not established in Germany.
Under certain conditions international travelers can receive VAT refunds if they are not a resident of the European Union: Tax-free shopping
Prepared by the International Trade Administration. With its network of more than 100 offices across the United States and in more than 75 markets, the International Trade Administration of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.
The EU applies Value Added Tax (VAT) to sales by non-EU based companies of Electronically Supplied Services (ESS) to EU-based non-business customers. U.S. companies that are covered by the rule must collect and submit VAT to EU tax authorities. From 1 January 2015, all supplies of telecommunications, broadcasting and electronic services are taxable at the place where the customer resides. In the case of businesses this means either the country where it is registered or the country where it has fixed premises receiving the service. In the case of consumers, it is where they are registered, have their permanent address, or usually live.
As part of the legislative changes of 2015, the Commission launched the Mini One Stop Shop (MOSS) scheme, the use of which is optional. It is meant to facilitate the sales of ESS from taxable to non-taxable persons (B2C) located in Member States in which the sellers do not have an establishment to account for the VAT. In 2021, this service will be extended to cover online sales of goods and services other than ESS.
This (optional) plan allows taxable persons (sellers) to avoid registering in each Member State of consumption. A taxable person who is registered for the Mini One Stop Shop in a Member State (the Member State of Identification) can electronically submit quarterly Mini One Stop Shop VAT returns detailing supplies of ESS or other to non-taxable persons in other Member States (the Member State(s) of consumption), along with the VAT due. The most important pieces of legislation on VAT are the EU VAT Directive 2006/112/EC, as amended, and its Implementing Regulation 282/2011, as amended
Further information relating to VAT on ESS:
https://ec.europa.eu/taxation_customs/business/vat/telecommunications-broadcasting-electronic-services/
VAT in Germany
The standard VAT rate in Germany is 19 percent (below the European average). A reduced 7 percent VAT rate applies to some consumer goods and everyday services (food, newspapers, local public transport, hotel stays). Some services (such as bank and health services or community work) are VAT exempt.
Vendors who are not established in the European Union and who make sales that are subject to German VAT must register for tax purposes in Germany. The tax office Bonn-Innenstadt (Service@FA-5205.fin-nrw.de) is responsible for assessing and collecting VAT for U.S. vendors who are not established in Germany.
Under certain conditions international travelers can receive VAT refunds if they are not a resident of the European Union: Tax-free shopping
Prepared by the International Trade Administration. With its network of more than 100 offices across the United States and in more than 75 markets, the International Trade Administration of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.