close

Newsroom

MGI Worldwide with CPAAI's Global VAT Specialist Group reports on the Reduction of German VAT from 1 July 2020

25th June 2020

MGI World Crop of Global VAT group white paper cover

The reduction of the German value added tax (sales tax) from 19% to 16% and from 7% to 5% sounds simple - but it is not. The VAT conversion means considerable extra work for both you and us! This paper provides you with important information and explanations. Unfortunately, some aspects are still unclear or have been eased in the discussion, so that we can only give you the current status here.

Reduction of VAT from 1 July

The reduction in value added tax (VAT) from 19% to 16% and 7% to 5% respectively will come into force from 1 July 2020. The reduced VAT rates currently apply until 31 December 2020.

It is demanded that there should be facilitations or a non-compliant regulation for the B2B sector. The aim would be to allow full deduction of input tax by the recipient in the case of invoices issued incorrectly with excessive VAT due to the change in tax rates. Whether or not such relief will be achieved has not yet been decided (17 June 2020).

Execution of the sales decisive

The reduced rates of VAT apply to all transactions carried out from 1 July 2020. It is not important when the payment for these sales is received. The only decisive factor is the time of performance.

Read the full white paper HERE

About MGI Worldwide with CPAAI's Global VAT Specialist Group

Our experienced indirect tax experts provide a centre of excellence in the field of VAT & Customs across the world. Besides compliance questions, these experts can answer any day-to-day questions as well as assist you, among others, with the correct qualification of transactions, evaluations of contracts, VAT audits and setting up processes together with creating manuals and guidelines.

Wherever your clients are doing business, let our Global VAT Specialists be your outsourced indirect tax team.

To learn more about the activities of the Global VAT Specialist Group, or any of the other Groups, please contact International Business Development Manager, Nicki Lynn nicki.lynn@mgiworld.com

MGI Worldwide with CPAAI is a top 20 ranked global accounting network and association with 10,000 independent auditors, accountants and tax experts in some 460 locations in almost 100 countries around the world.

Read more on Member white papers and Europe

MGI World Delovoy Profil Team members

A big welcome goes out to our new members in Russia as DELOVOY PROFIL Group joins the MGI Worldwide with CPAAI accounting network and association in the Europe Region

10th July 2020

MGI Europe is delighted to share the news that Moscow-based DELOVOY PROFIL Group is the latest firm...

MGI World Votum Award certification with congratulations overlay

Congratulations to MGI Worldwide with CPAAI member firm Votum AG as it is named one of Germany’s best auditors for the third time by Manager Magazin!

3rd July 2020

We are thrilled to announce that Frankfurt-based Votum AG has once again been voted one of the...

MGI World Screenshot of Pierpaolo Vannucci #IlLavoroContinua webinar with MGI Vannuci & Associati logo overlaid

MGI Europe member firm MGI Vannucci & Associati, based in Lucca, Italy, actively supports the Italian webinar initiative #IlLavoroContinua (#WorkEndures)

24th June 2020

Pierpaolo Vannucci, senior partner at MGI Worldwide with CPAAI accounting network and association...