Questions & Answers
Answers to common questions.
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2304 questions · Page 26 / 47
Which educational services are exempt from VAT starting in 2025?
From 1 January 2025, services directly serving school and educational purposes are VAT-exempt when provided by public institutions, private schools, and other educational providers holding a certificate from the competent state authority. The exemption now covers school and university instruction, initial and continuing training, retraining, and closely related services — no longer limited to occupational preparation. Instruction by private teachers (natural persons only) also remains exempt.
As of: December 2024
Which health insurance bonus payments fall under the tax-free allowance?
Covered are bonus payments granted by health insurance providers for health-conscious behavior of the insured. This typically includes bonuses for preventive medical check-ups, sports activities, or other preventive measures.
As of: December 2024
Which German federal states have already been fully transferred to the Central Register of Wills?
To date, the wills registers of the federal states of Bremen, Mecklenburg-Vorpommern, Niedersachsen, Schleswig-Holstein and Thüringen have been fully transferred. In addition, the former central wills index at the Amtsgericht Schöneberg in Berlin has been incorporated into the register.
As of: December 2014
What fines apply for violations of the new cash register requirements?
Violations are to be classified as a tax-related administrative offense and may be sanctioned with a fine of up to EUR 25,000. The fine can be imposed regardless of whether any actual tax loss has occurred.
As of: April 2016
What fines apply for failure to report or incorrect reporting to the Transparency Register?
Failure to report, as well as late or incomplete reporting, constitutes an administrative offense under § 56 Abs. 1 Nr. 55 ff. GwG. It can be sanctioned with fines of up to EUR 1 million. For serious, repeated, or systematic violations, the fine may be significantly higher.
As of: August 2021
What opportunities arise from the low internet usage in the skilled trades sector?
Since only about half of all skilled trade businesses are visible online, there is a clear competitive advantage for those who invest in a professional internet presence. Companies that engage early with a website and social media can stand out from competitors, reach new customer groups, and strengthen their regional market position.
As of: August 2013
Which computer hardware qualifies for the one-year useful life?
Covered items include desktop computers, notebooks, tablets, workstations, small-scale servers, docking stations, and external power supplies. Peripherals such as keyboards, mice, scanners, microphones, cameras, external hard drives, USB sticks, printers, projectors, speakers, and monitors are also included.
As of: March 2021
Which data did employers have to report under the ELENA procedure?
Employers were required to submit monthly earnings data for their employees, including details on salary and the amount of social security contributions. The data was transmitted electronically to a central storage authority. In parallel, paper forms still had to be completed as long as the authorities were not yet permitted to retrieve the data.
As of: December 2010
What income threshold applies from 2025 for the low-earner subsidy in occupational pension schemes (bAV)?
From 2025, the monthly gross income threshold for the additional state subsidy on employer-funded occupational pensions will be raised from EUR 2,575 to EUR 2,718. The threshold applies regardless of whether the employee works full-time or part-time. It will also be linked to the contribution assessment ceiling and thus indexed dynamically.
As of: December 2024
What income limits apply to tenants under charitable residential letting?
Tenants' income may not exceed five times the standard social assistance rate. For single individuals or single parents, the upper limit is six times the standard rate. The need for support must exist at the start of the respective tenancy.
As of: December 2024
What type of income do professional footballers earn from their club activities?
For tax purposes, professional footballers in team sports are considered employees of their club. Their ongoing remuneration therefore constitutes income from employment and is subject to standard wage tax deduction. Advertising income earned within the employment relationship with the player's own club also qualifies as employment income due to the player's obligation to follow instructions.
As of: July 2014
What type of income does a childminder generate for tax purposes?
A childminder can generate either income from employment (§ 19 EStG) or income from self-employment (§ 18 Abs. 1 Nr. 1 EStG). In practice, self-employment income predominates, as the activity is usually carried out on a freelance basis and without any prescribed training. Employment income only applies if the childminder is bound by instructions regarding the location, time and manner of care and the parents or a public body act as the employer.
As of: July 2021
Which types of income are covered by the extension of limited tax liability?
Going forward, income from employment will also qualify as domestic income if it is paid for periods of garden leave in connection with the termination of the employment relationship and the work would have been performed in Germany without the release. This makes such payments taxable for employees who neither reside nor are habitually present in Germany. The rule applies from the day after promulgation.
As of: December 2024
Which income and withdrawals from PV systems are tax-exempt under § 3 Nr. 72 EStG?
All income is tax-exempt regardless of how the electricity is used, in particular feed-in tariffs, payments for electricity supplied to tenants, charges for charging electric vehicles, subsidies, and VAT collected or refunded under the cash-basis accounting (EÜR). Withdrawals for non-business purposes are also tax-free, such as private residential use, the home office, or charging private electric vehicles. The sale of the PV system likewise falls under the exemption, provided the business generates exclusively privileged income.
As of: August 2023
What relief measures were adopted for families and single parents?
A one-time child bonus of €300 is paid for each child eligible for child benefits. The relief amount for single parents is temporarily increased for two years from €1,908 to €4,000. In addition, a bonus system is intended to strengthen the supply of apprenticeship positions at small and medium-sized enterprises.
As of: June 2020
What compensation do parents receive for loss of earnings due to school or daycare closures?
Under the revised Infection Protection Act, affected parents receive 67% of their net income, capped at €2,016 per month and for a maximum of 6 weeks. Eligible are parents of children under 12, provided no emergency care is available, working from home is not reasonable, and overtime has already been used up. No payment is made during school holidays.
As of: March 2020
Which inheritance tax classes exist and who falls into which class?
Tax Class I covers spouses, registered civil partners, children, grandchildren, as well as parents and grandparents (the latter only in cases of inheritance). Tax Class II includes siblings, nieces, nephews, sons- and daughters-in-law, stepparents, divorced spouses, and parents and grandparents in cases of gifts. Tax Class III applies to all other persons, such as uncles, aunts, unmarried partners, friends, and neighbors.
As of: January 2022
Which simplified access rules for short-time work benefits (Kurzarbeitergeld) have applied since 16 March 2020?
It is sufficient if 10 percent of the workforce is affected by the loss of work (instead of one third). Social security contributions are fully reimbursed to employers by the Bundesagentur für Arbeit. Temporary agency workers are also eligible, and negative working time balances no longer need to be built up.
As of: March 2020
What relief does the BEG IV provide for Steuerberater regarding the assignment of fee claims?
For the assignment or transfer of fee claims held by Steuerberater (German Certified Tax Advisors) that require the client's consent, an express consent in text form will suffice in future. The previously required written form with a handwritten signature is no longer necessary. The rule applies from the first day of the quarter following the promulgation of the act.
As of: December 2024
What relief is available for one-person GmbHs regarding the KiStAM query?
According to an announced decree of the federal states, corporations with only one non-denominational shareholder (so-called one-person GmbHs) no longer have to carry out the retrieval procedure. This eliminates the bureaucratic burden of the annual standard query for these companies.
As of: September 2016
What relief measures exist for extraordinary depreciation during the Corona pandemic?
During the pandemic, extraordinary depreciation and write-downs to going-concern value may be recorded during the year, allowing losses to be claimed early and facilitating deferral applications. In addition, retailers can recognize losses in value through extraordinary depreciation as eligible fixed costs under Bridging Aid III (Überbrückungshilfe III) and obtain reimbursement accordingly.
As of: April 2021
Which income taxes can heirs still deduct as estate liabilities?
Income taxes remain deductible if they originate from tax-relevant circumstances of the decedent. Examples include outstanding income tax prepayments or back payments, for instance arising from rental and lease income earned by the decedent during their lifetime.
As of: October 2023
What is the extension regarding the tax benefit for employee shareholdings under § 19a EStG?
The deferred taxation of the non-cash benefit from equity participations no longer applies only to shares in the employer's company, but also to shares in affiliated group companies. As a result, employees can also receive tax-privileged participations when shares of another group company are transferred to them.
As of: December 2024
Which gainful employment is permissible for child benefit purposes after completing the initial vocational training?
Under § 32 Abs. 4 S. 2 f. EStG, a child who has completed initial vocational training is only taken into account if they do not pursue any harmful gainful employment. Permissible are a regular weekly working time of up to 20 hours, an employment relationship that is part of vocational training, or marginal employment under §§ 8, 8a SGB IV. If the 20-hour threshold is exceeded, the entitlement to child benefit ceases.
As of: June 2023
Which acquisition transactions interrupt the attribution of a property to the company?
Attribution ends when the underlying acquisition transaction is reversed. However, the original attribution remains in place to the extent that the reversal or a reacquisition would result in circumventing a transaction subject to real estate transfer tax. This ensures that abusive unwindings have no tax effect.
As of: December 2024
Which types of bicycles qualify for the company car tax privilege?
Both classic bicycles and electric bicycles (pedelecs) are covered. High-quality e-bikes with a list price of, for example, EUR 3,000 can therefore result in effective net costs of only around EUR 10 per month for the employee if the employer bears the costs.
As of: November 2012
Which travel expenses can be claimed for tax purposes in the case of part-time distance learning?
According to the Lower Saxony Fiscal Court, a distance learning university does not qualify as the primary place of activity in a part-time study program. Therefore, trips to the university can be claimed under travel expense principles, either with the actual costs or at 0.30 € per kilometer driven. The deduction is not limited to the commuter allowance (Entfernungspauschale).
As of: June 2022
Which vehicles are exempt from the 1% rule under BFH case law?
Exempt are vehicles whose objective design and equipment are typically intended almost exclusively for transporting goods and can only occasionally be used privately. This applies in particular to trucks and tractor units, but also to vans equipped accordingly with a separated cargo area.
As of: September 2016
Which factors are driving the projected rise in insolvencies in 2015?
Key factors include the weak economy in the eurozone and slowing economic growth in China, which particularly affects export-oriented German companies. Added to this are the economic consequences of numerous geopolitical crises and hotspots, which are placing an increasing burden on German businesses.
As of: December 2014
What findings must the tax court make in the second round of proceedings?
The tax court must examine the traffic-related restrictions on the island in more detail. It must also assess to what extent the horse-drawn carriage services—taking into account the different types of transport—are comparable to taxi services without cars, and whether the distinction from rental car services is maintained.
As of: January 2020
What flexibility exists regarding the cash-basis principle in emergency aid (Soforthilfe) settlement?
For revenues within the funding period, companies may choose to use the date of service delivery instead of the date of payment receipt. This particularly benefits sectors such as skilled trades or trade fair construction, which operate with invoices and payment terms and would otherwise be disadvantaged by delayed incoming payments.
As of: August 2020
What is the consequence of missing entry in the register of donation recipients?
Without entry in the register, a foreign recipient may not issue valid donation receipts on official forms or as electronic donation confirmations. As a result, donors cannot claim a tax deduction for donations in Germany.
As of: December 2024
What consequences do retirees face if they have missed filing their tax return?
Retirees who failed to file despite being subject to tax liability must expect back assessments covering several years. In addition, late-filing surcharges and interest may apply. In severe cases, criminal tax proceedings for tax evasion can also be initiated.
As of: November 2011
What are the consequences of missing time records for mini-jobbers?
If time sheets are missing or incomplete, the mini-job status can be called into question if the wage paid, calculated against the hours worked, falls below the minimum wage. This can result in back payments of wage tax and social security contributions. In addition, fines may be imposed under the Minimum Wage Act.
As of: July 2013
What are the consequences of missing or deficient cash records?
If cash records are missing or inconsistent, tax audits regularly result in substantial additional estimates of revenue. These estimates lead to significant back taxes, including interest. Careful and coherent cash bookkeeping is therefore practically indispensable, even for businesses using the cash-basis accounting method (EÜR).
As of: August 2013
What are the consequences of failing to register for electronic tax filing?
If a tax return is submitted to the tax office late due to missing registration, a late-filing surcharge may be imposed. Since the registration process can take up to 14 days, you should register in good time.
As of: October 2012
What consequences may arise from incorrect recording of tips?
Failures may lead to additional tax assessments by the tax office, fines of up to €25,000 and, in extreme cases, criminal tax proceedings. Proper separation and documentation of tips is therefore essential to avoid these risks.
As of: May 2021
What consequences arise if false self-employment is established?
Social security contribution liability applies retroactively from the start of the activity. The client can be held liable for social security contributions for up to 30 years retroactively, while the contractor's liability is limited to a maximum of 3 months retroactively. In addition, the client faces fines or prison sentences of up to five years for withholding wages.
As of: September 2016
What are the consequences of misuse of EU funds?
The options for financial corrections in cases of identified irregularities have been expanded. As a deterrent, the European Commission will in future publicly disclose decisions imposing sanctions for the misuse of EU funds.
As of: November 2012
What consequences does a managing director face for payments made after insolvency has occurred?
If the managing director continues to make payments from company assets after illiquidity or over-indebtedness has occurred, he is personally liable with his private assets for these amounts. In addition, criminal consequences may arise, for example for delaying insolvency proceedings (Insolvenzverschleppung).
As of: August 2013
What are the consequences if a credit note is not labelled as 'Gutschrift'?
If the mandatory designation is missing, the recipient may be denied the input VAT deduction. In addition, the wrongfully claimed input VAT may be subject to interest charges under § 233a AO. This risk is particularly significant in the case of retrospective tax audits.
As of: December 2012
What are the consequences of false statements in the application for Corona emergency aid?
False statements leading to an unjustified receipt of emergency aid qualify as subsidy fraud. In addition to repayment of the funds, criminal prosecution may follow. In the application form, the applicant expressly affirms that all information has been provided truthfully and to the best of their knowledge.
As of: May 2020
What are the consequences of the BFH ruling VI R 29/13 for the deductibility of accident costs?
Although the ruling only concerned repair costs after misfuelling, it raises the question of whether accident costs incurred on the commute to work will also no longer be additionally deductible in the future. Until now, extraordinary expenses such as accident costs were recognised in addition to the flat-rate allowance. Whether this practice will be continued remains open after the ruling.
As of: November 2014
What are the consequences of the ECJ ruling for existing working-time models?
Employers must review and, where necessary, redesign their current time-recording systems, individual agreements, and flexible working-time models. Particularly for modern, flexible work arrangements, mandatory full recording of working hours may impose significant restrictions and represents a step backward for the digital workplace.
As of: August 2019
What are the consequences of missing programming logs for electronic cash registers?
For cash-intensive businesses using programmable electronic cash register systems, the absence of programming logs constitutes a significant formal deficiency in cash management. This deficiency entitles the tax office to estimate taxable income under § 162 AO. Taxpayers should therefore retain all setup, programming, and modification logs of the cash register in full.
As of: April 2017
What are the consequences of missing programming logs for electronic cash register systems?
When using a programmable cash register system, the operating manual and programming logs are subject to retention requirements. According to the BFH, the absence of these records constitutes a formal defect in the bookkeeping. This defect alone generally entitles the tax authorities to make an additional estimate of revenue.
As of: August 2015
What are the consequences of the ruling for lease-intensive corporations?
Corporations with high lease expenses – such as petrol station operators – continue to bear a substantial trade tax burden without being able to deduct it for tax purposes. In the case decided, an affected GmbH had unsuccessfully challenged the deduction prohibition.
As of: May 2014
What are the practical consequences of the ruling for sales of withdrawn properties?
Anyone who withdraws a property from business assets without recognizing profit and sells it within 10 years must fully tax the difference between the sales price and the book value as other income under § 23 EStG. This also applies to heirs and donees in the context of anticipated succession. No step-up to fair value for tax purposes takes place.
As of: July 2022
What are the consequences of exceeding the French delivery threshold?
Once the delivery threshold of EUR 35,000 net is exceeded, the supplier must register for VAT in France. Deliveries must then be invoiced with French VAT (currently 20%). In addition, ongoing VAT advance returns and an annual VAT return must be filed in France.
As of: April 2016
What are the tax consequences of waiving the profit-making intention?
Once the application is approved, no further income from business operations under § 15 EStG is generated, eliminating the need for an income-surplus statement and Annex G. This treatment applies not only to the current year but also to prior open and future assessment periods. VAT obligations, however, remain unchanged.
As of: January 2022