on VAT

Charitable Associations can Use an Average Sum for VAT in the Year of Founding

2009-02-06T10:05:01+01:00

Charitable Associations can Use an Average Sum for VAT in the Year of Founding

In the summer of 2002, seven persons founded a charitable association having the goal to foster culture. In September 2002, they preformed a concert and obtained a net turnover of EUR 141,799 and cashed in on EUR 9,925.93 on VAT. In their predeclaration on VAT for September, this association typed in these amounts and set off the same amount on input tax. This input tax was computed pursuant to §23a I 1 UStG as a flat sum. This provision determines that charitable organizations deduct input tax with the flat rate of 7% if they are not required to submit balance sheets - and only the flat rate. The competent tax office denied deducting the flat input tax and only accepted the (lower) actual spent input tax. The office argued that this rule is not valid for the first year of business.

Dividing Input Tax by Buildings with Mixed Use

2009-02-02T16:45:12+01:00

Dividing Input Tax by Buildings with Mixed Use

When building or purchasing a house, which is partially rented to private persons and partially to businesses, the input tax (prepaid VAT) must be reasonably split for deduction. But what is the appropriate splitting method is appropriate after the final tax assessment? This article reports on the judgment of Bundesfinanzhof (= Federal Tax Court, re V R 49/05 March 2, 2006, published August 30, 2006).

Double Payment of Customer as Turnover

2009-02-02T16:34:30+01:00

Double Payment of Customer as Turnover

The BFH had to set the rules how to compute the double payment of a customer and his refunding July 19, 2007, re V R 11/05; published on November 7, 2007).

Flat input Taxation Payment for Translators

2009-09-28T15:54:18+02:00

Flat Input VAT Payment for Translators

As has been introduced already some professions can submit a flat input VAT amount in their VAT return. Can translators consider themselves writers in terms of the law? Well, the Federal Tax Court told us in its judgment of July 23, 2009 (re V R 66/07).

Is Selling a Car Purchased Without Input Tax Subject to VAT?

2009-02-05T14:37:30+01:00

Is Selling a Car Purchased Without Input Tax Subject to VAT?

A GbR consisting of tax consultants bought a car from a private person, i.e. without VAT for their company. After using it for some time, they wanted to sell it – again without VAT. The tax office disagreed and wanted to collect value added tax from the company. With the ruling of March 2, 2006, re V R 35/04 (published on July 19, 2006), the BHF put an end to that dispute.

Physicians need VAT for Expert Opinions

2009-02-03T17:57:13+01:00

Physicians need VAT for Expert Opinions

Among physicians it is well known that their medical services are not subject to VAT – according §4 no. 14 UStG. Is this still the same, when you write expertises that insurers need to prepare their decision to or not grant any benefits to the patient? The Federal Tax Court answered this question on December 31, 2007 (re V B 98/06).

Relevance of Delivery Time when Identical with Invoice Date

2009-06-11T18:09:06+02:00

Relevance of Delivery Time when Identical with Invoice Date

The BFH settled a dispute between a butcher and his tax office on the deductibility of the input (VAT) tax in an invoice with the judgment of December 17, 2008 (re XI R 62/07, published on March 4, 2009). The legal question was all about a formality if also a delivery date were to be mentioned in the invoice.

Renting out a Car to One's Employee: Is this business?

2009-03-10T18:13:39+01:00

Renting out a Car to One's Employee: Is this business?

When an employee buys a car, rents it out to his employer, can this be business? Will input tax be deductible? The Federal Court of Justice decided on this on October 11, 2007 (re V R 77/05 - published on February 6, 2008.

Small Entrepreneur's Rule might be Applicable Retroactively

2009-03-30T15:54:49+02:00

Small Entrepreneur's Rule might be Applicable Retroactively

Small start-ups have the choice to either waive billing with VAT or billing with VAT - the so-called small entrepreneur's rule (§19 III UStG). Usually are usually bound to their prognosis. The tax court Düsseldorf set up an exception to this otherwise strict rule on June 20, 2008 (re Az: 1 K 3124/07 U).

Supply of Goods on Presentation of Gift Coupons as Input Tax

2009-02-05T13:41:06+01:00

Supply of Goods on Presentation of Gift Coupons as Input Tax

Black closed a contract with White to be supplied with advertisement gifts. Black, however, did not want to personally receive these gifts but rather they should have been handed over directly to his customers. These customers were cashing in on "shopping vouchers" they had received from Black. In regards to White, they acted as representatives of Black. The tax office, however, did not want to accept the collected input tax. The office considered it as an abuse of the freedom of construction. The BFH made their ruling on August 24, 2006 (published on December 6, 2006, re V R 16/05).