Questions & Answers
Answers to common questions.
Curated from our articles on tax advisory, statutory audit and legal services — alphabetical, filtered by audience or topic.
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2304 questions · Page 22 / 47
What is the Mini One Stop Shop (MOSS) and what advantage does it offer?
The Mini One Stop Shop (MOSS) is a simplification scheme that allows businesses to declare and pay VAT owed in other EU member states centrally through the Federal Central Tax Office (Bundeszentralamt für Steuern, BZSt). This eliminates the obligation to register for VAT in each individual EU member state and file separate returns there. The total VAT is remitted in a single payment to the BZSt.
As of: November 2014
What is the partnership bonus under Elterngeld Plus?
If both parents work part-time at the same time for 25 to 30 hours per week, each parent receives an additional four months of Elterngeld Plus as a partnership bonus. Single mothers and fathers who share joint custody are also eligible for this bonus.
As of: January 2015
What is the blocking notice under Section 51a (2e) EStG and what are its consequences?
By filing a blocking notice (Sperrvermerk) with the BZSt, the recipient of investment income can object to the disclosure of their religious affiliation to the party required to withhold tax. That party then only receives a zero value, and no church tax is withheld. Instead, the church tax is subsequently assessed as part of the income tax assessment, which obliges the taxpayer to file an income tax return. The blocking notice must be received by the BZSt by 30 June of a given year in order to take effect for the following standard inquiry.
As of: August 2014
What is the difference between ELSTER and ERiC?
ELSTER is the online portal of the German tax administration for the electronic transmission of tax data. ERiC is the technical interface (client software) that enables third-party applications such as tax firm software to transmit data to the tax administration.
As of: December 2024
What is the difference between Grundsteuer A and B?
Grundsteuer A (property tax A) is levied on agricultural and forestry properties such as farms, arable land, or forest holdings. Grundsteuer B (property tax B) applies to all other developed or developable properties, including residential property as well as rental and commercial real estate.
As of: March 2021
What is the difference between inventory list and stocktaking?
The inventory list (Inventar) is the written record of all assets and liabilities, including quantities and values. Stocktaking (Inventur), by contrast, refers to the actual physical recording of stock through measuring, counting, and weighing. In other words, stocktaking is the activity, while the inventory list documents its results.
As of: November 2023
What is the time-series comparison as an estimation method used by the tax authorities?
The time-series comparison is a mathematical-statistical verification method applied in particular to restaurant businesses during tax audits. Annual revenues and purchases of goods are broken down into weekly segments, and the gross profit markup rate is calculated for each week. The tax authorities then apply the highest markup rate from any ten-week period to the entire year, which often results in substantial additional assessments.
As of: August 2015
What is the automatic exchange of financial account information under CRS?
The Common Reporting Standard (CRS) is a common reporting standard adopted by the OECD and G20 in 2014. On this basis, participating states automatically exchange information on financial accounts on an annual basis in order to combat international tax evasion. To date, more than 100 states and territories have committed to implementing the standard.
As of: September 2017
What is the continuation-linked loss carryforward under § 8d KStG?
Since 2016, corporations may, upon application, preserve loss carryforwards despite a harmful change in shareholders if they continue their business operations unchanged. Requirements include unchanged continuation for three years or since incorporation, no addition of a further business operation, no participation in a co-entrepreneurship, no status as a controlling company in a fiscal unity, and no contribution of assets below fair market value.
As of: December 2017
What is the 10-year speculation period when selling real estate?
If a property is sold within 10 years of acquisition or construction, the capital gain is generally subject to income tax as a private disposal transaction under § 23 EStG. An important exception applies to owner-occupied residential property: in this case, the gain is tax-free even within the 10-year period. Until recently, it was disputed how a home office claimed for tax purposes should be treated in this context.
As of: June 2018
What is the 30/70 method in tax audits?
The 30/70 method is an estimation technique used in sit-down restaurants, based on the assumption that 30% of revenue comes from beverages and 70% from food. It relies on the premise that guests consume a certain amount of beverages with each meal and that this ratio fluctuates only slightly. The recorded beverage revenue is then used to extrapolate a hypothetical total revenue.
As of: March 2016
What is the €110 flat rate for work equipment and when is it worthwhile?
Without itemized proof, the tax office accepts a flat rate of €110 per year for all work equipment of an employee, including specialist literature, office supplies, and work clothing. Since the flat rate covers all work equipment combined, it is quickly exceeded. Higher amounts can only be deducted with receipts and invoices.
As of: December 2021
What is the BAFF award?
BAFF stands for 'Bocholter Auszeichnung für FamilienFreundlichkeit' (Bocholt Award for Family Friendliness) and is presented by Bündnis für Familie in Bocholt e.V. Companies are recognized for overall family friendliness as well as for individual measures and projects that are particularly family-friendly. The award is granted in different size categories based on the number of employees.
As of: October 2013
What is the tax base of the real estate transfer tax under Sections 8 and 9 GrEStG?
Pursuant to Section 8 (1) GrEStG, the tax base is the consideration paid by the purchaser. Under Section 9 (1) GrEStG, this includes all services rendered by the purchaser, in particular the purchase price together with any other obligations assumed. The decisive factor for determining the scope of the consideration is the condition of the property at the time the purchase agreement is concluded.
As of: December 2022
What is the Focus-Money Top Tax Advisor award?
Focus Money annually recognizes tax advisory firms in various size categories as Top Tax Advisors. The award is regarded as an external seal of quality and complements formal certifications such as ISO 9001 or the quality certification of the DStV.
As of: January 2011
What is the promotion of charitable housing purposes?
The promotion of charitable housing purposes has been added as a new charitable purpose to the official catalogue. It covers the provision of housing at reduced rates to persons in need, in particular those who require assistance due to their physical, mental, or emotional condition or who receive social welfare benefits. As a result, such rentals can be recognised as charitable for tax purposes.
As of: December 2024
What is the inflation compensation bonus (Inflationsausgleichsprämie) and what is the maximum tax-free amount?
The Inflationsausgleichsprämie (IAP) is a voluntary employer benefit designed to help employees cope with inflation-related financial burdens. It can be granted free of tax and social security contributions up to a total amount of EUR 3,000 during the eligible period from 26 October 2022 to 31 December 2024. This maximum applies to the entire period, not per year.
As of: January 2023
What is a cash register inspection (Kassennachschau) under Section 146b AO?
The Kassennachschau is an audit instrument of the tax authorities used to verify the proper keeping of cash records. It may be carried out at any time and without prior notice on the business premises of the entrepreneur. In particular, it examines whether the cash records match the actual cash on hand (cash-count capability).
As of: May 2016
What is the mobility allowance and who was it created for?
The mobility allowance (Mobilitätsprämie) is a state subsidy for low-income commuters whose taxable income falls below the basic tax-free allowance (2022: €9,984). Since these individuals pay no income tax, the increased commuter allowance (Entfernungspauschale) would have no relieving effect for them. The Mobilitätsprämie provides compensation so that low earners can also benefit from the increased commuter allowance.
As of: March 2022
What is the flat-rate tax under Section 37b EStG on benefits in kind?
Section 37b EStG allows the grantor to tax benefits in kind and gifts to business partners or employees at a flat rate of 30%, plus solidarity surcharge and church tax. This eliminates the need for individual taxation by the recipient. The grantor assumes the tax liability and reports it to the tax office.
As of: March 2014
What is the Wirtschafts-Identifikationsnummer (W-IdNr., German Economic Identification Number)?
The W-IdNr. under § 139c AO is a nationwide uniform business identification number for enterprises. It serves as the primary key in the new corporate base data register under the UBRegG and aims to reduce bureaucracy and increase transparency in taxation procedures by harmonising various tax types and administrative processes.
As of: September 2024
What is the extended trade tax deduction for real estate under Section 9 No. 1 Sentence 2 GewStG?
The extended trade tax deduction for real estate (erweiterte Grundstückskürzung) is a trade tax benefit for companies that exclusively manage and use their own real estate. The trade income attributable to the management and use of the company's own real estate is fully deducted, meaning no trade tax is ultimately levied on this income. It is particularly relevant for purely asset-managing corporations and commercially characterized partnerships that generate commercial income solely by virtue of their legal form.
As of: November 2016
What is the extended trade tax deduction under §9 Nr. 1 Satz 2 GewStG?
It allows companies that exclusively manage and use their own real estate (and, where applicable, their own capital assets) to reduce their trade income by the portion attributable to the management and use of the real estate. The prerequisite is that the activity does not exceed the scope of private asset management. If the activity is genuinely commercial in nature, the deduction is excluded.
As of: June 2024
Was ist die geplante "Aktivrente"?
Mit der Aktivrente soll Weiterarbeiten im Rentenalter steuerlich attraktiver werden — wie das aussehen soll, lesen Sie im Beitrag. (Quelle: Deubner Recht & Steuern)
As of: December 2025
What is the voluntary self-disclosure with exemption from prosecution in tax law?
The voluntary self-disclosure (strafbefreiende Selbstanzeige) is an instrument that allows tax evaders to obtain exemption from prosecution by voluntarily disclosing the evaded taxes and paying them back in full. It is intended to offer tax offenders a path back to tax compliance. The provision is politically controversial but continues to be supported by many fiscal policymakers.
As of: February 2014
What is the reasonable personal contribution (zumutbare Eigenbelastung) for extraordinary expenses?
The reasonable personal contribution is an income-dependent deductible that the taxpayer must initially bear themselves in the case of extraordinary expenses such as medical costs. Only costs exceeding this threshold reduce the tax burden. Its amount depends on marital status, the number of children, and total income.
As of: September 2013
What is a shareholder loan and who can grant one?
A shareholder loan is a credit that a shareholder grants to their corporation (e.g. GmbH). It is governed by the provisions of the German Civil Code and entails a repayment obligation of the debtor. As long as the company is not in financial distress, it may repay the loan like any ordinary liability. This form of financing is reserved for corporations.
As of: December 2020
What is a status determination procedure at the Deutsche Rentenversicherung?
In the status determination procedure, the Deutsche Rentenversicherung (German Statutory Pension Insurance) reviews upon request whether an activity qualifies as self-employment or as dependent employment. If dependent employment is determined, social security contributions are mandatory. The procedure provides legal certainty for both principals and contractors.
As of: August 2017
What is a fictitious family residence under Art. 67 EC Regulation 883/2004?
A fictitious family residence exists when a family member already lives and works in an EU member state, so that the remaining family members are treated as if they also resided there. Under German child benefit law, this is sufficient to establish residence. As a result, a claim to child benefit can arise even before the family actually moves to Germany.
As of: February 2021
What is an intra-Community triangular transaction?
An intra-Community triangular transaction is a special form of chain transaction under § 25b UStG. It involves three businesses from three different EU member states concluding sales transactions over the same goods, with the goods moving directly from the first supplier to the final customer. The transport or dispatch must be carried out by the first supplier or the first purchaser, and the goods must move from one member state to another.
As of: February 2024
What is a Cash-GmbH in the context of anticipated succession?
A Cash-GmbH is a GmbH whose assets consist exclusively or predominantly of cash holdings, sight deposits, and bank balances. It was used to transfer cash to the next generation free of gift tax, because cash was previously not classified as tax-detrimental administrative assets within the meaning of §§ 13a, 13b ErbStG. This allowed the relief provisions for business assets to be applied and the gift tax burden to be reduced to zero.
As of: November 2012
What is a Cash-GmbH in the context of inheritance tax?
A Cash-GmbH is a GmbH whose assets consist exclusively or predominantly of cash holdings or monetary receivables. In the past, it was used to transfer cash assets tax-free to the next generation by leveraging the inheritance and gift tax privileges granted for business assets.
As of: April 2013
What is a credit note (Gutschrift) in the VAT sense?
A Gutschrift in the VAT sense is the invoicing of a supply by the recipient instead of by the supplier. It must not be confused with a corrective invoice (commercial credit note), which adjusts an original invoice. This distinction is essential for the correct labelling of the document.
As of: December 2012
What is a cash register inspection (Kassen-Nachschau) and when may it take place?
The Kassen-Nachschau is a special procedure for the prompt review of the proper keeping of cash records and their transfer into the bookkeeping. It may be carried out unannounced during normal business hours — in the hospitality sector, this can also mean in the evening.
As of: April 2016
What is a prepayment penalty (Vorfälligkeitsentschädigung)?
A Vorfälligkeitsentschädigung is the compensation a borrower must pay to the lender when a loan is repaid before the end of the agreed fixed-interest period. It compensates the bank for the lost interest income and typically arises when a loan is repaid early in connection with the sale of a property.
As of: February 2024
What can a tenant do if the tax office does not accept the service charge statement as proof?
If the required information is not evident from the service charge statement or the property management statement, the tenant must obtain copies of the underlying invoices from the landlord or property management and submit them to the tax office. In addition, operating cost statements may be filed as supplementary evidence.
As of: August 2023
What does the tax court criticise about the treatment of adult children in vocational training?
The tax court objects to the fact that a lower amount is exempt from taxation for adult children undergoing vocational training than for adult children without such training. This unequal treatment is among the issues to be clarified by the Federal Constitutional Court.
As of: December 2016
What do restaurateurs need to consider when switching to 7% VAT as of 1 July 2020?
Restaurateurs must adjust their POS systems and invoicing software so that food sales are shown at 7% instead of 19% from 1 July 2020. Particular care is required in separating food from beverages (which remain at 19%), as well as in correctly recording the transactions in the accounts and in the VAT pre-registration.
As of: May 2020
What must the construction service provider check going forward when issuing invoices?
The performing entrepreneur must clarify whether the recipient is a property developer (Bauträger) or a general contractor (Generalunternehmer). For a property developer, the invoice is issued with VAT, as § 13b UStG does not apply. For a general contractor, the reverse charge mechanism generally applies, so the invoice is issued without VAT.
As of: December 2013
Was muss ich zur E-Rechnungs-Pflicht beachten?
Im B2B-Bereich gelten gestufte Pflichten zur elektronischen Rechnung. Die Infografik finden Sie im Merkblatt-Verzeichnis unter "E-Rechnungen". (Quelle: Deubner Verlag)
Was muss ich zur Erbschaft- und Schenkungsteuer wissen?
Freibeträge und Steuerklassen bestimmen die Erbschaft- und Schenkungsteuer. Die Infografik finden Sie im Merkblatt-Verzeichnis unter "Erbschaftsteuer". (Quelle: Deubner Verlag)
What happens with share transfers of more than 50% under the new rules?
Only the pro-rata forfeiture of losses under § 8c Abs. 1 KStG for acquisitions between 25% and 50% has been abolished. The rule on complete forfeiture of losses for transfers exceeding 50% remains unaffected by the legislative change. In these cases, loss carryforwards continue to be forfeited in full, unless exceptions such as the built-in gains clause or § 8d KStG apply.
As of: November 2018
What happens if old Dutch VAT IDs are used in EC Sales Lists from 2020 onwards?
From 1 January 2020, only the new Dutch VAT IDs of sole proprietors may be used in EC Sales Lists (Zusammenfassende Meldungen). Using the old numbers will trigger error messages. This may call into question the VAT exemption of the underlying supply.
As of: January 2020
What happens if the model proceedings on the interest rate are decided favorably?
If the courts rule in favor of taxpayers, everyone who filed a timely appeal will automatically be refunded the excess interest paid by the tax office. Without an appeal, the assessment becomes final and a refund is not possible.
As of: September 2016
What happens if performance thresholds are exceeded or fallen short of during the year?
If an object- or subject-related threshold under § 3 Nr. 72 EStG is exceeded or fallen short of during the year, the tax exemption applies on a pro rata basis up to or from that point in time. Typical triggers include the addition of a residential or commercial unit or the commissioning of an additional installation. Example: If a conversion increases the number of commercial units as of August 1, a previously taxable installation becomes tax-exempt from that date onward.
As of: August 2023
What happens if the pension insurance exemption is reported late to the Minijob-Zentrale?
If the 6-week deadline is missed, the employer must provide an explanation for the delay. The exemption then only takes effect after the end of the month following the month in which the notification is received by the Minijob-Zentrale. Until that point, the employee remains subject to mandatory pension insurance and must continue to pay contributions.
As of: September 2022
What happens to input VAT deduction if more than two company events take place per year?
Input VAT deduction within the EUR 110 threshold is only available for a maximum of two company events per year. For any additional events, the tax authorities no longer assume a predominantly business-related interest, meaning the expenses are deemed privately co-induced and input VAT deduction is excluded.
As of: August 2023
What happens in a GbR if the sole managing director dies?
Upon the loss of the sole partner authorized to manage the company, the joint management authority of the remaining partners automatically revives pursuant to § 709 Abs. 1 BGB. All partners are then jointly entitled and obliged to manage the company.
As of: January 2015
What happens to tax assessments that have been challenged by an appeal?
If the tax assessment was kept open by an appeal, it has not yet become final and binding. Following the Constitutional Court's decision, the tax office amends the assessment in favor of the taxpayer, allowing the home office expenses to be subsequently taken into account.
As of: July 2010
What happens to applications already submitted for the BAFA Corona consulting subsidy?
Only applications for which the BAFA has already issued a preliminary approval (Inaussichtstellung) will be granted and paid out. Otherwise, consideration is only possible through a follow-up procedure, provided that an eligible proof of use is submitted and sufficient budget funds are available.
As of: June 2020