When do I need to be VAT registered and pay taxes in Germany?
You, as a seller, have a VAT obligation in Germany whenever your stock is stored in a German warehouse (e.g. Amazon warehouse) and the delivery starts in Germany or you have exceeded the distance selling threshold to Germany (EUR 100,000).
What is the distance selling threshold?
The distance selling threshold is €100,000 per annum. If your company is located inanother European country and products are not stored in any warehouse in Germany, VAT Compliance in Germany becomes necessary as soon as you exceed the distance selling threshold.
What is the tax number?
In Germany, you will receive two numbers within the VAT process. The first number is the tax number (Steuernummer), which is a general number used by the tax authorities. It serves as reference to your (monthly) VAT filings and general correspondence.
What is the VAT ID-number?
The VAT ID is a 9-digits long number including the appropriate country code (e.g. DE for Germany). You will receive this number after receiving your tax number. It serves as identification in terms of intra-community supplies, which basically comes to use whenever you do business with companies from other European countries (B2B).
Example of a German VAT number: DE 918273645
Where do I submit my tax registration as well as the VAT return filings?
In Germany different tax offices are responsible for your VAT application, depending on where your company is based (e.g. for Chinese companies the tax office Neukölln or US companies tax office Bonn are responsible). In order to receive a VAT number you need to submit certain information about your company as well as specific documentation (e.g. Shareholder agreement, FBA agreement).
What information is required to get a registered and receive a German VAT number?
German tax authorities will ask you to provide the proper documentation as well as a few additional forms:
- Business License
- Identity Card of the managing Director
- Shareholders agreement (if any)
- Storage contract/FBA agreement (if any)
What additional tax obligations apply?
Besides declaring your sales by filing VAT return, mostly on a monthly but also on a quarterly basis, and consequently paying the VAT due, you also need to file an annual VAT return office and you must retain records and documents that are relevant for tax purposes and must submit them to the tax office upon request.
What is a tax certificate?
From 01.01.2019 all electronic marketplaces are liable for every online seller who is not VAT compliant. Consequently, online marketplaces (e.g. Amazon) now require their sellers to provide a tax certificate, stating their tax compliance in Germany, in order to prevent suspension. In cases where the seller does not hold any stock that leaves a German warehouse or has not exceeded the distance selling threshold to Germany, there is no tax registration necessary. Consequently, no tax certificate under § 22f German VAT Act can be received.
Please contact us if you are unsure whether you qualify for receiving the certificate from German tax authorities or would like to file your application for tax registration accordingly.