German VAT compliance update

Thu 30th Oct 2014

There has been a range of changes to the German VAT regime. These changes include:

  • The application of the reverse charge on mobile phones has been extended to include any devices containing SIM cards for mobile access. The domestic reverse charge applies in German on sales above €5,000 to help eliminate missing trader fraud
  • The German Supreme Court has confirmed that the snacks on board flights was subject to VAT. They were found not to be an ancillary to the supply of international transport (the flight) and therefore did not benefit from an exemption from VAT. This follows EU VAT Directive practise on the liability to VAT on purchases made on-board flights for carry off.
  • The German finance minister has provided guidance to charitable organisations on receiving donations from businesses and any potential VAT liability. This includes only giving limited prominence to donor’s logo’s or activities to ensure the monies are treated as a service fee and therefore not liable to German VAT.