VAT News

EC-Letter of formal notice issued to Germany

The European Commission (EC) has recently sent a letter of formal notice to Germany. Their view is that Germany violates the rules on VAT refunds based on existing EU VAT legislation.

Under the current German VAT legislation, a taxable person established in Germany that applies for a VAT refund from another EU Member State via the German online system can lose the right to this refund as a result of Germany not following up on potential error messages from the EU Member State of refund.

Furthermore, the EC considers that Germany is violating the administrative cooperation rules where it is requested by an EU Member State of refund to notify resident taxable persons of the relevant rules and decisions, but fails to do so.

Germany now has 2 months to act and if they do not do so, a reasoned opinion will be issued by the EC.

Any German businesses who have had cross-border VAT claims rejected and not been given full information on the rejection should review the position.

Related articles

COVID-19 VAT Cashflow Tips (Part One)

COVID-19 is affecting business in ways no one thought possible. In order to free yourself from the burden of cashflow worry, we’re trying to do our bit to advice you on ways you can inject income into your bottom line.

Read more
HMRC Postpones Phase 2 Making Tax Digital Till April 2021

April 1 2020, was meant to be the date that HMRC launched phase II of making Tax Digital across the UK. However, due to COVID-19, they have made the decision to postpone the rollout by one year to April 1 2021. 

Read more
Coronavirus: Tax provisions and Easements by Country 

A country-by-country breakdown of the tax provisions and easements being implemented by individual country tax authorities.

Read more