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 29 / 47
Which services fall under the MOSS scheme?
The MOSS scheme covers telecommunications, broadcasting and television services as well as electronically supplied services to private customers in other EU member states. Typical examples include online texts, images, apps, databases and online software. A key requirement is that the services are provided across borders within the EU to non-business customers.
As of: November 2014
Which services are subject to the construction withholding tax under § 48 EStG?
All services that involve the construction, repair, maintenance, alteration, or removal of structures are covered. The term "structure" is broadly defined and includes all installations connected to the ground, such as tunnels. Pure planning services by architects or structural engineers, as well as maintenance and cleaning work, are not covered, provided they are not subordinate to a construction service as an ancillary service.
As of: May 2023
Which catering-related services in a retirement home specifically qualify for the tax credit?
The proportionate labor costs for preparing meals in the on-site kitchen and for serving them in the dining hall qualify for the tax credit. Material costs and the cost of the food itself are not deductible; the breakdown must be clearly shown on the retirement home's invoice.
As of: September 2012
Which payments must be included in the assessment basis for the artists' social security levy (Künstlersozialabgabe)?
All payments made for obtaining or using the work or services must be included. This particularly covers fees and commissions paid for the sale of the work, as well as ancillary costs such as telephone, freight, material, and personnel expenses. VAT paid to the artist or publicist is not included in the assessment basis.
As of: January 2022
What capacity limits apply to the tax exemption for PV systems under § 3 Nr. 72 EStG?
The maximum tax-exempt gross capacity depends on the building type: 30 kW (peak) for single-family homes and non-residential buildings with a single unit (e.g., a commercial property with one commercial unit or a garage property). For two-/multi-family homes, mixed-use properties, and commercial properties with multiple units, the limit is 15 kW (peak) per residential or commercial unit. The decisive figure is the gross capacity as listed in the Marktstammdatenregister (German Market Master Data Register).
As of: August 2023
In a chain transaction, which supply is the moving supply?
In a chain transaction, the movement of goods can only be attributed to one supply (§ 3 Abs. 6a UStG). If the first supplier transports the goods, their supply to the first purchaser is the moving supply, which may qualify for the VAT exemption for intra-Community supplies. The subsequent supply is treated as a stationary supply, with its place of supply at the end of the transport (§ 3 Abs. 7 S. 2 Nr. 2 UStG).
As of: February 2024
What measures does the BMF plan against cash register manipulation?
Three core measures are planned: the mandatory use of a certified technical security device for electronic recording systems, the introduction of a cash register inspection (Kassen-Nachschau), and the imposition of sanctions for violations. The aim is to ensure the immutability of digital primary records such as cash register entries.
As of: April 2016
What measures does the reform provide against abuse of the inheritance tax exemption?
The reform aims in particular to prevent so-called cash companies, which were previously used to transfer liquid assets tax-free via a GmbH. In addition, luxury items such as classic cars, yachts or artworks are generally excluded from the relief in order to prevent abusive use of the tax benefit.
As of: September 2016
What majority is required to approve a restructuring plan?
The restructuring plan no longer requires unanimous approval; a majority of 75% of the creditors' voting rights is sufficient (§ 9 StaRuG). This removes a key reason why restructuring plans have failed in the past. The plan can be implemented by the company itself or through the court.
As of: April 2021
Which VAT rates apply from 01/01/2021 after the COVID-19 reduction?
The reduced VAT rates of 16% and 5%, in effect since 01/07/2020, expire on 01/01/2021. From 01/01/2021, the regular rates of 19% and 7% apply again. The decisive factor for the applicable rate is the date the supply or service is rendered, not the invoice date or payment date.
As of: December 2020
Which VAT rates apply from 01/01/2021 following the temporary reduction?
From 01/01/2021, the standard VAT rates of 19% (regular rate) and 7% (reduced rate) apply again. The temporary reduction to 16% and 5% was limited to the period from 01/07/2020 to 31/12/2020. An exception applies to restaurant and catering services for food, which remain subject to the reduced rate of 7% until 30/06/2021.
As of: December 2020
What features characterize a photo book for VAT purposes?
A photo book is individually designed by the customer using software or a web application provided by the supplier and consists predominantly of photos, possibly supplemented by short texts. It serves to document private events or to present companies, is not intended for general distribution through publishers or bookshops, and has no ISBN.
As of: May 2016
Which features indicate genuine self-employment?
Indicators of self-employment include entrepreneurial conduct, freedom from instructions, employing one's own staff subject to social security contributions, and the free choice of work location, working hours, and assignments. Maintaining one's own bookkeeping, setting fees independently, and the option to decline assignments are further indicators. Decisive is always the overall picture of the activity.
As of: September 2016
What methods are available for taxing the private use of a company car?
The private use of a company car can be taxed either on a flat-rate basis using the 1% rule or via the logbook method. The logbook method can be particularly advantageous when the vehicle is only used privately to a limited extent or when a precise allocation of usage shares is desired.
As of: December 2023
What minimum requirements must initial vocational training meet from 2015 onwards?
Under the planned rules, initial vocational training must be a structured program with a minimum duration of 18 months full-time and must conclude with a final examination. Short courses or crash programs no longer meet these requirements and do not qualify as recognized initial vocational training. With this change, the legislator aims to curb tax planning models that use brief preliminary training solely for tax optimization.
As of: October 2014
What minimum amounts apply for registering a tax allowance?
For a tax allowance (Freibetrag) to be registered, the claimed expenses must total more than EUR 600. For pure work-related expenses (Werbungskosten), they must additionally exceed the employee lump-sum allowance (Arbeitnehmer-Pauschbetrag) of EUR 1,000. Only then is an application for wage tax reduction (Lohnsteuerermäßigung) worthwhile.
As of: February 2014
Which model proceedings are pending against the level of late-payment interest?
Before the Finanzgericht Münster (Münster Tax Court), proceedings are pending under case number 10 K 2472/16E. In addition, proceedings are pending before the BFH under case numbers I R 77/15 and III R 10/16.
As of: September 2016
Which estate-related costs are generally deductible for inheritance tax purposes?
Under § 10 Abs. 5 Nr. 3 ErbStG, deductible costs are those directly related to the settlement, administration or distribution of the estate, or to the acquisition of the inheritance — for example funeral costs, costs of obtaining a certificate of inheritance (Erbschein), and costs of estate settlement. By contrast, ongoing costs of managing the estate are not deductible.
As of: May 2015
What evidence is required for property tax relief on vacant properties?
For vacant properties, the 50% relief is only granted if the landlord can prove active efforts to find new tenants. Suitable evidence includes invoices from real estate agents or listings on property portals.
As of: March 2021
What documentation is required to deduct nursing care costs?
You should have a written contract with the care service that specifies the tasks performed and the time involved. In addition, a qualified medical assessment confirming the necessary care hours is required, as the tax office and courts may limit the deduction to what is medically necessary.
As of: November 2016
What documentation is required for the tax reduction under Section 35c EStG?
The measure must be carried out by a qualified specialist company. Required documents include an invoice, payment via bank transfer, and a certificate issued by the executing specialist company or energy consultant in accordance with the official template (BMF circular of 31.03.2020). The costs for this certificate and 50% of the costs of an energy consultant also qualify as eligible expenses.
As of: September 2020
What evidence should landlords secure in cases of tenant-caused damage?
Landlords should document that the property was free of defects upon acquisition (e.g., handover protocol) and that the damage only occurred during the tenancy due to culpable conduct by the tenant. Suitable evidence includes photos, handover and move-out protocols, contractor invoices, and witnesses, in order to claim an immediate deduction as income-related expenses (Werbungskosten) before the tax office.
As of: December 2017
What evidence does the tax office require for the deduction of childcare costs?
You need an invoice for the childcare service provided, plus a bank statement showing payment to the service provider's account. These formal requirements are designed to prevent abuse and undeclared work. Other forms of evidence, such as cash receipts, are not sufficient.
As of: June 2015
What evidence must be provided to the statutory health insurance fund?
Self-employed persons must submit their income tax assessment (Einkommensteuerbescheid) for the relevant calendar year to their health insurance fund within three years after the end of that year. For 2018, the evidence must therefore be provided by the end of 2021. If the evidence is not submitted on time, contributions will be assessed based on the contribution assessment ceiling (Beitragsbemessungsgrenze; 2018: EUR 53,100).
As of: February 2018
Which ancillary activities are harmless for the extended trade tax reduction but not themselves privileged?
Harmless activities include managing one's own capital assets, developing residential buildings, constructing and selling single-/two-family homes or condominiums (provided this does not constitute commercial real estate trading), and supplying electricity from renewable energy sources to tenants. However, the profits from these activities are not privileged and remain subject to trade tax.
As of: March 2023
What new rule is planned for undeclared foreign investment income?
A tax-related suspension of the start of the assessment period (Anlaufhemmung) is to be introduced for undeclared foreign investment income. As a result, the assessment period will begin later, allowing the tax office to subsequently tax such income over a longer period.
As of: November 2014
What changes does the Emergency Paramedic Act 2014 introduce?
The act replaces the previous profession of Rettungsassistent (paramedic) with the Notfallsanitäter (emergency paramedic). The training period is extended from two to three years. In addition, trainees are now entitled to a training allowance for the first time.
As of: December 2013
What new rule on administrative assets was planned in the JStG 2013?
Under the proposed § 13b Abs. 2 S. 2 Nr. 4 ErbStG-E, cash, sight deposits, bank balances, and other receivables were to be classified as harmful administrative assets to the extent they exceed 10% of the company's value. Receivables arising from actual operating business activities were to be excluded. As a result, the tax-free transfer of pure cash GmbHs would effectively have been ruled out.
As of: November 2012
What non-objection rule applies to retrofittable cash register systems without a TSE?
Retrofittable cash register systems were required to be equipped with a TSE by 30 September 2020. The deadline is extended to 31 March 2021 if the TSE was bindingly ordered and its installation bindingly commissioned by 30 September 2020, or if the cash register system requires a cloud-based TSE that is not yet available. No application for the extension is required, but the conditions must be verifiably met.
As of: September 2020
What non-objection rule did the BMF issue regarding TSE retrofitting?
By letter dated 6 November 2019, the BMF issued a non-objection rule limited until 30 September 2020. During this period, the use of cash register systems without a certified technical security device (TSE) was not objected to, as only a few providers were able to deliver.
As of: November 2019
Which provision governs the deduction of work-related expenses for trips between home and the primary place of work?
The relevant provision is § 9 Abs. 1 S. 3 Nr. 4 EStG. Under this rule, expenses are covered on a flat-rate basis by the commuter allowance (Entfernungspauschale) per full kilometer of distance. Higher actual expenses may only be claimed under § 9 Abs. 2 S. 2 EStG when public transportation is used – not for car or taxi travel.
As of: December 2022
What useful life is assumed when calculating the notional book value of a passenger car?
A useful life of 6 years is typically applied when calculating the notional depreciation. This results in an annual notional depreciation of one-sixth of the original acquisition cost. This amount is multiplied by the vehicle's age and deducted from the acquisition cost.
As of: August 2013
What is the general upper limit for additional estimates by the tax office in cases of cash register deficiencies?
Additional estimates are generally limited to the highest net profit rates set out in the official guideline rate collection (Richtsatzsammlung). The BMF's Richtsatzsammlung contains industry-specific benchmark figures that serve as a reference for estimates. This upper limit protects taxpayers from excessive add-backs.
As of: May 2014
Which online channels should skilled trades businesses use alongside a website?
In addition to your own website, a presence on social media such as Facebook, Xing or comparable platforms is recommended. These channels help demonstrate professional expertise, build trust and stay in touch with existing and potential customers. At present, the skilled trades sector still uses these channels significantly less than average.
As of: August 2013
What options exist after the 20-year EEG feed-in tariff expires?
Operators can continue selling electricity through power providers (approx. 4-5 cents/kWh) or directly to private buyers such as neighbours or municipalities, retrofit a battery storage system, replace the modules with more efficient technology, or dismantle the installation. The choice significantly affects depreciation and input VAT deduction options.
As of: June 2021
Which photovoltaic systems are to become exempt from income tax under the JStG 2022?
An exemption is planned for income from photovoltaic systems of up to 30 kW (gross nominal capacity per the Market Master Data Register) installed on, at or in single-family homes (including ancillary buildings) and commercial properties. For buildings used predominantly for residential purposes, such as multi-family homes, a limit of 15 kW per residential or commercial unit applies. An overall cap of 100 kW (peak) applies per taxpayer or co-entrepreneurship.
As of: October 2022
What lump-sum deduction applies in 2023 for secondary scientific, artistic, or teaching activities?
For self-employed secondary activities of a scientific, artistic, literary, teaching, or examining nature, the lump-sum business expense deduction amounts to up to 25% of operating income from 2023 onwards, capped at EUR 900 per year. Previously, the maximum was EUR 614 per year.
As of: December 2023
Which mandatory information is required on invoices for travel services under § 25 UStG?
Since 1 July 2013, invoices for travel services must include the notation "Sonderregelung für Reisebüros" (special scheme for travel agents). Without this information, the invoice is not properly issued and does not entitle the recipient to deduct input VAT.
As of: September 2013
Which mandatory wording has been required on VAT credit notes since 1 January 2013?
Since 1 January 2013, VAT credit notes must contain the German term "Gutschrift". Without this wording, the document does not entitle the recipient to deduct input VAT. For foreign-language settlements (e.g. "self-billing"), the term "Gutschrift" should be added in brackets as a precaution.
As of: August 2013
Which mandatory information has been required on a credit note (Gutschrift) since 01.07.2013?
Since 01.07.2013, a credit note (Gutschrift) in the VAT sense must explicitly include the wording "Gutschrift". If this information is missing, the document does not qualify as a proper invoice, meaning the recipient cannot claim input VAT deduction from it.
As of: September 2013
Which mandatory invoice details were disputed in the BFH case?
At issue were the missing specification of the actual delivery date and the supplier's tax number on invoices for car deliveries. The BFH accepted the invoice date as a sufficient indication of the time of supply, since the delivery clearly took place in the same month. As a result, the input VAT deduction was preserved.
As of: June 2018
Welche Pflichten gelten bei der E-Rechnung?
Zur verpflichtenden E-Rechnung im B2B-Bereich gibt es einen aktuellen Umsetzungsstand mit Übergangsfristen — Details und Fundstelle im Beitrag. (Quelle: Deubner Recht & Steuern)
As of: December 2025
What obligations and deadlines apply to the employer when filing a reimbursement claim?
The employer must continue to pay wages to employees affected by the official measure for up to six weeks and can then claim reimbursement of these amounts from the competent authority. The reimbursement application must be submitted within 12 months. The deadline begins at the end of the prohibited activity, the quarantine, or the facility closure.
As of: November 2020
What obligations and elective rights apply to permanent impairment of fixed assets?
Under German commercial law, a permanent impairment of fixed assets triggers a mandatory extraordinary write-down. Under tax law, by contrast, a write-down to going-concern value (Teilwertabschreibung) is elective. If the impairment is not permanent, an extraordinary write-down is generally prohibited under commercial law (exception: financial assets) and not permitted for tax purposes.
As of: April 2021
Which photovoltaic systems and combined heat and power plants can waive the profit-making intention?
Eligible applicants are operators of photovoltaic systems with an installed capacity of up to 10 kW/kWp and combined heat and power plants of up to 2.5 kW/kWp. All taxable persons as well as co-entrepreneurships qualify. Multiple systems operated by the same person are treated as a single business, meaning their capacities are aggregated regardless of whether they are located on one or several properties.
As of: January 2022
What position does the IDW take on the option exemption regarding administrative assets?
The IDW opposes linking the option exemption to a maximum threshold of 10% administrative assets. It argues that such a rigid limit is not appropriate and should therefore not be part of the new statutory rules.
As of: August 2016
Which items are added back to profit for trade tax purposes?
Trade tax add-backs include, among others, interest on debt, lease payments and licensing fees. These items are partially added back to the profit from business operations, which means that even a commercial loss can result in a positive trade income and thus a trade tax liability.
As of: November 2012
Which process steps does a rating go through?
First, insolvency risks are classified into risk categories and represented using key performance indicators. The indicators are then combined into a KPI system and condensed into a risk assessment by reviewing their values. Based on this assessment, targeted measures for improvement are developed.
As of: December 2020
What review and warning duties do Steuerberater have under § 102 StaRuG?
Under § 102 StaRuG, Steuerberater (German Certified Tax Advisors), Rechtsanwälte (German Attorneys-at-Law) and Wirtschaftsprüfer (German Statutory Auditors) acting as external reviewers are legally required to alert their clients to potential grounds for insolvency. When examining client records, they must specifically watch for any indications of insolvency. This obligation supplements the warning duties already established by BFH case law.
As of: April 2021
What invoice requirements apply for input VAT deduction on meal expenses?
A proper invoice is required, showing VAT separately and naming the entrepreneur or company as the recipient of the service. For partnerships and corporations, only the company itself is entitled to deduct input VAT. For small-value invoices up to EUR 250 (§ 33 UStDV), the recipient does not need to be specified.
As of: July 2022