German VAT reverse charge
To help reduce the VAT compliance burden for EU companies trading in Germany (and all EU member countries) a VAT compliance simplification mechanism, the ‘reverse charge’, is used. This allows the recording of any German VAT transactions to be pushed to the recipient of the goods or services. This then means the foreign supplier has no need VAT register in Germany.
When is the German VAT reverse charge used?
The reverse charge mechanism is applied in the following circumstances:
- The supply of services to a German VAT registered business (2010 VAT package).
- Supply and install contracts.
- Supply of certain types of power.
- Other various minor goods.
Latest German news
December 12, 2018
On 12 December, the European Commission published details of a new rule which would make large online marketplaces responsible for calculating, collecting and remitting VAT on certain B2C cross-border transactions below €150. Where goods are imported by an EU or non-EU merchant, and then sold via a marketplace in another EU country..
November 18, 2018
Germany has extended the timetable for the implementation of consignment stock VAT registration simplification until the start of 2019....
November 12, 2018
On 9 November 2018, the German Parliament passed a new law making online marketplaces potential liable for unpaid VAT by third-party merchants on their platforms....
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