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Germany VAT Rate

Germany had raised its rate of VAT (value added tax) from 16% to 19% with effect from 1 January 2007. VAT is imposed on assets and services in Germany as well as on imports into Germany. Overseas exports are exempted from VAT in Germany. There are special conditions for small businesses.

The raise was expected to hoist £13 billion for the government and will result in reducing Germany's budget deficit. The VAT increase on most goods and services places Germany now nearer to the EU’s average VAT rate.

While choosing which rate will be applicable the key importance is given on the actual time of supply. The factors like the date of the contract, the date of issue of the invoice, the date of payment are given less importance.

There also exist reduced rate of 7% which will be applied to food and agriculture products, books, newspapers etc.

The government had reduced the VAT (Value-Added Tax) on hotel rooms in Germany from 19 percent to 7 percent at the beginning Jan. 1 2010. The rate remains the same for food and other purchases.

Practically it means that hotel costs will remain the same but in the case of recovering the VAT, businesses will have the ability to recover just over one-third of what is now being recovered and the hotels will keep the other two-thirds.

Under the German VAT Law (§ 13b Sec. 3 No. 4 German VAT Act / § 13b Sec. 3 No. 5 German VAT Act), SEMI is authorized to gather VAT on the supply of services related with the German organization of trade fairs and exhibitions to non-resident exhibitors.

The existing VAT rate is 19%. SEMI will charge VAT to all non-German based companies’ invoices for services provided in Germany.

You are eligible for getting refund of your VAT paid to the German Tax Authority which will depend on your present VAT registration position and other services received in Germany.

For all German based companies who are inhabitants of Germany, the “reverse charge mechanism” is applied as per the German VAT Law.

German VAT Rate

♦   Standard Rate 19% (since Jan 2007)
♦   Reduced Rate 7%
♦   Germany VAT Recovery Time: 3-4 months
♦   Germany VAT Registration Threshold Non-Resident: Nil

IMPORTENT LINKS

Vat refund in Germany
Germany Vat rate
German Vat Rule
German Vat Registration
VAT Refund for Foreign Exhibitors

 



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