Questions & Answers
Answers to common questions.
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Is the tax office allowed to increase the flat-rate amounts for goods withdrawals on a lump-sum basis?
According to the Fiscal Court of Münster, a blanket increase of the official rates by additional amounts for non-food items is unlawful. Within its estimation authority, the tax office must provide a comprehensible explanation as to why the official flat rates are insufficient in the specific case. The mere fact that a food retailer also carries non-food items does not justify an additional estimate.
As of: August 2022
Do the flat-rate amounts for in-kind withdrawals also cover non-food items in food retail?
According to the ruling of the Münster Tax Court (judgment of 29 April 2022, 10 K 1297/20), the flat rate for the food and beverage retail sector is sufficient and also covers withdrawals of non-food items such as cleaning supplies, hygiene products, and cosmetics. An additional estimate by the tax office for non-food items is not permitted. The court reasoned that, based on general experience, food retailers typically also carry such items in their product range.
As of: August 2022
Does the entitlement to Kurzarbeitergeld (short-time work allowance) lapse if the employment relationship is terminated?
Yes. Kurzarbeitergeld from the Bundesagentur für Arbeit (Federal Employment Agency) is subject to the condition that the employment relationship has neither been terminated nor ended by a mutual termination agreement. If notice of termination is given, the entitlement to Kurzarbeitergeld lapses, and the employer must once again pay the wages itself.
As of: March 2021
What wage must the employer pay following a termination during short-time work?
There is currently no binding statutory rule or supreme court decision on this point. Under the prevailing interpretation and an older BAG ruling, validly agreed short-time work continues to apply, meaning the employer owes only the reduced wage in the amount of the previous short-time work allowance – not the full pre-short-time-work salary.
As of: March 2021
Is the FG Münster ruling on non-food withdrawals final and binding?
No, the FG Münster allowed an appeal and the case is now pending before the BFH. A final decision by the highest court is still outstanding. Affected taxpayers should therefore keep comparable assessments open and, where appropriate, refer to the pending BFH proceedings.
As of: August 2022
Is the interpretation regarding wage levels in cases of termination during short-time work legally binding?
No. There is currently neither a clear statutory basis nor recent court rulings specifically addressing this constellation. The interpretation that only the reduced wage is owed is a legal assessment and may be evaluated differently by a court in individual cases.
As of: March 2021
Why does the reduced wage entitlement remain in place even when short-time work allowance ceases?
Short-time work involves two levels: the employment contract level between employer and employee, and the social security level with the Bundesagentur für Arbeit (Federal Employment Agency). If only the social security level ceases to apply, the validly agreed short-time work remains effective at the contractual level. Otherwise, a dismissed employee would be in a better position than a colleague still employed under short-time work arrangements.
As of: March 2021
What are the tax consequences if a retailer fails to keep records of withdrawals of goods?
If the business owner does not maintain individual records of withdrawals in kind, the tax office is entitled to make an estimate pursuant to § 162 Abs. 2 Satz 2 AO. In practice, the official flat-rate amounts for withdrawals in kind applicable to the respective trade sector are regularly used. These values may be applied by the taxpayer and are generally accepted by the tax office.
As of: August 2022
What is the significance of the official flat-rate amounts for withdrawals of goods?
The flat-rate amounts published annually in a BMF circular are based on empirical data and serve as guidance for estimating withdrawals of goods pursuant to § 162 Abs. 2 Satz 2 AO. They apply when the taxpayer does not keep separate records of goods withdrawn. While they eliminate the need for itemized records, they are not a rigid upper limit.
As of: August 2022
What role does a collective bargaining agreement play in dismissals during short-time work?
If an applicable collective bargaining agreement exists and contains provisions on wage payments upon dismissal during short-time work, those provisions take precedence. The amount of the wage claim is then determined by the collective agreement, without requiring further interpretation.
As of: March 2021