Delivery thresholds 2019 and 2021

The latest information directly from the Tax Consultants' Day 2018 in Bonn:
New delivery thresholds for online retailers from 2021 and for electronic service providers already from January 2019

AccountOne was at the German Tax Consultants Day in Bonn on October 08 and 09, 2018 with a booth and got the latest info on the implementation of the planned VAT laws for online retailers from January 2019.

In mid-December 2018, the so-called Annual Tax Act is to be passed and come into force on 01.01.2019. Recently, there has been a lot of coverage in the daily press about the fact that Chinese online retailers in particular are selling goods in Europe and especially in Germany without paying VAT. This was, among other things, the reason to enact new regulations for online trade at EU level.

The first thing to mention here is the introduction of a uniform EU-wide turnover threshold for electronic online services (such as the music streaming service Spotify). So far, EU national VAT laws can set the thresholds for VAT registration themselves. This is expected to change on 01 January 2019, all EU countries will then have a uniform supply threshold of €10,000 (net). For online trade in goods, the delivery threshold is not expected to change until 01 January 2021.

This means that anyone who, as an online retailer, was still able to sell goods for €35,000 (net) at German VAT rates to Austria, for example, in 2018 will only be able to do so up to a total annual turnover of €10,000 from 2021. This is what is found in the draft bill of the Annual Tax Act 2018 on Section 3a (5) UStG. If, on the other hand, the net turnover limit of €10,000 per year is exceeded, the turnover is taxable where the private customer is domiciled or resident, as in our example in Austria. This makes a daily updated delivery threshold monitoring like AccountOne has integrated in your software essential. We assume that there will be an increased demand from the tax offices and thus also tax consultants for a VAT registration.

From January 2021, the simplified One Stop Shop procedure is expected to be introduced, i.e. sales exceeding the delivery threshold can then be reported to a central office in Germany. It would be desirable, however, at present it is not foreseeable whether registration for warehouse use in the respective country would be omitted.

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