As a result of new legislation effective January 1, 2019 Germany has broadened its Value Added Tax (VAT) tax filing compliance efforts. The law regarding VAT seller responsibilities has not changed, that is, all sellers of products into Germany, regardless of where your business is located or where your product is stored, have VAT collection and filing obligations. The method of filing, however, can vary depending on your gross German sales and the location of your product warehousing.
As a result of significant non-compliance in the VAT arena the marketplace vendors, such as Amazon, are now required under the new law to report detailed seller information to the German VAT taxing authorities. This will allow Germany to identify and assess tax and penalties on the sales where the VAT was not collected and submitted.
This new law is effective for non-EU sellers for transactions beginning March 1, 2019 (the EU sellers effective date is October 1, 2019). The United Kingdom implemented similar legislation in March of 2018. If you are currently selling product in Germany (or any other EU country) and have not registered with the VAT taxing authorities you should contact us to help determine your VAT filing obligations as soon as possible to avoid possible tax assessments and penalties in the future.
About the Author:
Transfer Pricing Specialist
David Marion joined Thompson Greenspon in 2014 as a transfer pricing specialist. Having worked with the IRS for more than 35 years, David’s experience is instrumental to interpreting regulations and providing other guidance for a variety of complex and often controversial international issues.
David has held a number of compliance-related positions during his tenure with the Examination and Large Business & International divisions of the IRS. As Manager of the International Technical Advisor headquarters group, he provided a wide variety of technical support across the country. During his 12 years of managing a large group of international examination specialists, David was intimately involved with many international cases, of which transfer pricing was the most prevalent issue.
In addition, as Foreign Payments Manager, David was also responsible for the IRS compliance program for international withholding. Within this position, David helped enforce policy consistency among various IRS centers.
As Competent Authority Manager, David gained extensive transfer pricing experience with Europe and Canada. He conducted numerous negotiations with foreign officials on behalf of taxpayers, of which 95 percent were closed successfully with mutual agreements.