The 2012 worldwide VAT, GST and sales tax guide

G ERMANY 253
refers to supplies of goods and services that are not liable to
German VAT and that do not give rise to a right of input tax
deduction (see Section F). Some supplies are classified as
“exempt with credit,” which means that no VAT is chargeable, but
the supplier may recover related input tax. Exempt with credit
supplies include exports of goods outside the EU and related
services, and intra-Community supplies of goods (see the chapter
on the EU, page 208).
The following are the two rates of VAT in Germany:
• The standard rate at 19%
• The reduced rate at 7%
The standard rate of VAT applies to all supplies of goods or services,
unless a specific provision allows a reduced rate or exemption.
An option to treat VAT-exempt supplies and services as taxable
supplies exists.
The following tables list examples of exempt supplies of goods
and services, and supplies of goods and services that are taxed at
a reduced rate of VAT (these lists are not exhaustive and exceptions
apply in each case, as specified by law).
Examples of exempt supplies of goods and services
Land and buildings
Financial transactions
Insurance
Education
Medical services
Examples of goods and services taxable at 7%
Books and newspapers
Cultural services
Food
Passenger transport (however, effective from 2012, transport by
ship is subject to the standard rate of 19%)
Agricultural products
Hotel stays
E. Time of supply
In principle, German VAT payable is due on the 10th day following
the end of the filing period (Voranmeldungszeitraum) in
which the VAT falls due. A filing period may be a month or a
quarter of the calendar year.
The VAT falls due at the end of the filing period in which a supply
takes place (tax point). However, some taxable persons are
permitted to account for VAT on a cash basis (cash accounting).
If cash accounting is used, the tax point is the end of the filing
period in which payment is received.
Prepayments. The tax point for an advance payment or prepayment
is the end of the VAT return period in which payment is
received.
Reverse charge. The tax point for a supply taxed under the reversecharge
procedure (self-assessment by a German taxable person)
is the end of the month following the month in which the supply