German switches VAT payers to quarterly returns 2021
- Dec 16, 2020 | Richard Asquith
Germany is to allow more small and newly VAT registered foreign businesses to file quarterly VAT returns.
Currently, taxpayers with VAT liabilities above €7,500 per annum and newly registered businesses are automatically put onto monthly German VAT returns. This is an anti-VAT fraud measure. § 18 para. 2 sentence 1 UStG. The newly registered businesses may then switch to the regular quarterly filing schedule the second calendar year after they were registered if there are not compliance issues with their VAT filings.
From 1 January 2021, this will be suspended meaning newly registered businesses will be on quarterly filing immediately. However, the requirement will revert on 1 January 2027.
Also, the threshold for using the VAT cash accounting basis is being raised to €600,000 per annum.
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