Germany VAT guide
Germany’s Value Added Tax (VAT), known locally as Mehrwertsteuer (MwSt.) or Umsatzsteuer (USt.), was first introduced on 1 January 1968.
As a European Union (EU) Member State, Germany’s VAT rules are derived from EU directives, ensuring its national legislation-codified in the Umsatzsteuergesetz (UStG) is aligned with the broader EU VAT system.
Recent updates:
Germany is introducing mandatory eInvoicing for domestic Business-to-Business (B2B) transactions, rolling out in three key phases. This new obligation applies to companies established in Germany for transactions between themselves. Critically, there is currently no eInvoicing requirement for non-established, VAT-registered-only companies, nor for documenting Business-to-Consumer (B2C) transactions.
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What is the VAT rate in Germany?
19%
Standard rate: 19%
Reduced rate: 7%
Zero rate: 0%
Applies to exports and intracommunity supplies
Exempt categories: Activities in public interest, such as heath, education and other listed activities such as finance and insurance
VAT registration in Germany
A seller must register for VAT if their turnover exceeds the relevant threshold for their establishment status.
Resident businesses: A German-established entrepreneur may be exempt from charging VAT (under Article 19 of the German VAT Act (UStG), known as the Small Business Regulation) if both of the following apply:
- Their total turnover in the previous calendar year did not exceed €25,000.
- Their expected turnover in the current year does not exceed €100,000.
If a business exceeds either threshold, it must register for regular VAT treatment.
Non-established businesses:
- EU Businesses: Must register if thresholds are exceeded and notification formalities are completed.
- Distance Sales: Registration is not required if the supplier is established in only one EU Member State and the total value of intra-Community distance sales of goods and cross-border electronically supplied services to customers in all other EU Member States is below the EU-wide threshold of €10,000.
- EU-wide threshold: €10,000 (for B2C distance sales of goods and electronically supplied services). Once exceeded, VAT is due in the country of destination (Germany).
- Non-EU businesses: Must register for VAT regardless of turnover when making a taxable supply in Germany. They may simplify their reporting obligations by using the One Stop Shop (OSS) scheme if applicable.
Processing registration
Registration usually takes up to four to six weeks to be processed by the German tax office, after which the business receives a general tax number. A separate VAT identification number is then obtained for intra-Community transactions.
eInvoicing requirements
Germany is introducing mandatory eInvoicing for domestic Business-to-Business (B2B) transactions, rolling out in three key phases.
Key dates to mark:
- 1 January 2025: All domestic companies must be able to receive eInvoices.
- 1 January 2027: The requirement to issue eInvoices becomes mandatory for large enterprises (with an annual turnover exceeding €800,000 in the previous calendar year).
- 1 January 2028: The requirement to issue eInvoices extends to all remaining medium, small and micro enterprises.
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Using AI and machine learning, our technology puts your VAT data through over 300 automated VAT rules, checking for errors, and preparing VAT returns for approval and submission. Comply provides a full audit trail for the German Tax Authorities.
VAT return filing and deadlines
Businesses in Germany must submit an annual VAT return. In most cases, they must also file preliminary VAT returns on either a monthly or quarterly basis.
The frequency for filing the preliminary return is determined by the total VAT liability from the previous calendar year:
- If the VAT liability for the previous year was more than €9,000, you must file monthly preliminary VAT returns in the current year.
- If the VAT liability for the previous year was not more than €9,000, you must file quarterly preliminary VAT returns in the current year.
- If the VAT liability for the previous year did not exceed €2,000, the tax office may grant an exemption from the obligation to submit preliminary VAT returns.
- If the taxpayer had a refund/surplus of more than €9,000 in their favour for the previous calendar year, they can elect to file monthly preliminary VAT returns instead of quarterly ones.
Filing Deadlines
Preliminary VAT returns (monthly or quarterly): These must be submitted no later than the 10th day of the following calendar month. Businesses can request a permanent one-month extension.
Annual VAT returns:
For the business filing directly: The return must be filed by 31 July of the year that follows the reporting period.
VAT penalties
Failing to meet VAT deadlines in Germany can lead to two main types of penalties:
- Late payment surcharge: If the tax isn’t paid by the due date, a late payment surcharge is immediately due (Article 240 of the Fiscal Code, Abgabenordnung). This surcharge is calculated at 1% of the rounded-down outstanding tax amount for every commenced month of delay. The outstanding tax amount must first be rounded down to the nearest value divisible by €50. The total surcharge is then rounded down to the nearest euro and is capped at €25,000.
- Late filing penalty: A late-filing penalty can be imposed if you fail to file a tax return or fail to file it on time (Article 152 of the Fiscal Code, Abgabenordnung). The penalty is 0.25% of the assessed tax for each commenced month of delay, with a minimum charge of €10 for each commenced month of delay.
Fiscal representatives
Fiscal representatives are not mandatory in Germany.
VIES declarations
In Germany, the VAT Information Exchange System (VIES) declaration, also known as the EC Sales List (ESL), must be submitted electronically by the 25th day after the end of the reporting period. The filing frequency is generally quarterly or monthly, with annual submission permitted only in exceptional circumstances.
Intrastat
Registration and submission
Businesses must submit Intrastat reports when movements of goods within the EU exceed specified thresholds.
Intrastat Thresholds for 2025
German Intrastat reporting features separate thresholds for
arrivals and dispatches:
Intrastat Arrivals
- Basic threshold: €3,000,000
- Detailed reporting: €50,000,000
Intrastat Dispatches
- Basic threshold: €1,000,000
- Detailed reporting: €45,000,000
Deadlines and frequency
Intrastat declarations in Germany are generally submitted monthly. To ensure compliance, they must be filed with the Federal Statistical Office (Statistisches Bundesamt) no later than the 10th working day after the end of the respective reporting month.
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