Section 4: Tax and input VAT

§ 13b Recipient as taxable person

(1) For supply of services provided by a taxable person resident in another Community territory which are taxable in Germany according to § 3a paragraph 2, VAT shall be incurred on expiry of the preliminary VAT return period in which the supplies were carried out.

(2) For the following taxable transactions, the VAT shall be incurred when the invoice is issued, or at the latest, on the expiry of the calendar month following the month in which the supply was carried out:

1. Work deliveries and supply of services, which do not fall within the scope of paragraph 1, carried out by a taxable person resident abroad;

2. supplies of goods assigned by way of security by the party furnishing the collateral to the assignee, beyond the ambit of insolvency proceedings;

3. transactions that fall within the scope of the Real Estate Transfer Tax Act;

4. construction work, including work deliveries and other services in connection with immovable property that are used for the construction, repair, maintenance, alteration or demolition of buildings, with the exception of planning and supervision services. In particular, objects, equipment and machines that have been permanently installed in a building or a structure and that cannot be moved without destroying said building or structure shall also be considered to be immovable property. Number 1 shall remain unaffected.

5. supplies of

   1. goods mentioned in § 3g paragraph 1 sentence 1 by a taxable person established abroad under the conditions set out in § 3g and

   2. gas via the natural gas system and electricity, not within the scope of lit. a.

6. assignments of rights according to § 3 number 3 of Greenhouse Gas Emissions Trading Act, emission reduction units according to § 2 number 20 of the Project Mechanisms Act and certified emission reductions according to § 2 paragraph 21 of the Project Mechanisms Act, emission certificates according to § 3 number 2 of the Fuel Emissions Trading Act, as well as gas certificates and electricity certificates;

7. the supply of goods mentioned in Annex 3;

8. cleaning of buildings and parts thereof. Number 1 shall remain unaffected;

9. the supply of gold with a purity of at least 325 thousandths, unwrought or as semi-finished goods (from position 7108 of the customs tariff) and of gold plating with a gold purity of at least 325 thousandths (from position 7109);

10. the supply of mobile phones, tablet computers, games consoles and integrated circuits prior to installation into an object suitable for delivery at retail level, where the sum of the consideration to be charged for them is at least EUR 5,000 within a single economic transaction; subsequent reductions of the consideration are disregarded.

11. the supply of the goods mentioned in Annex 4, if the sum of the consideration to be charged for them is at least 5,000 Euros within a single economic transaction; subsequent reductions of the consideration are disregarded;

12. the supply of services in the telecommunication sector. Number 1 shall remain unaffected.

(3) By way of derogation from paragraph 1 and paragraph 2 number 1, VAT shall be incurred for supplies, which are provided continuously over a period of more than one year, at the latest upon expiry of each calendar year in which they were actually provided.

(4) Where paragraph 1 to paragraph 3 are applied, § 13 paragraph 1 number 1, lit. a, sentences 2 and 3 shall apply accordingly. If, in the cases referred to in paragraph 1 to paragraph 3, as well as in sentence 1, the consideration, or a partial amount thereof, is received prior to the supplies or a part of the supplies being carried out, VAT shall be incurred in this respect on the expiry of the preliminary VAT return period in which the consideration, or partial amount thereof, has been received.

(5) In the cases mentioned in paragraphs 1 and 2 numbers 1 to 3, the recipient shall be liable for VAT if he is a taxable person or a legal person; in the cases mentioned in paragraph 2 number 5 lit. a, numbers 6, 7 and 9 to 11, the recipient shall be liable for VAT, if he is a taxable person. In the cases mentioned in paragraph 2 number 4 sentence 1, the recipient shall be liable for VAT regardless of whether he uses the supply he purchased for a supply provided by him, within the meaning of paragraph 2 number 4 sentence 1, if he is a taxable person who provides respective supplies on a sustained basis; this can be assumed, if the responsible tax office has issued him with a certificate in this respect that he is taxable person who provides respective supplies, which certificate is valid at the time of the performance of the transaction and for a maximum term of three years and can only be cancelled or withdrawn with future effect. With regard to the supply of natural gas mentioned in paragraph 2 number 5 lit. b, the recipient shall be liable for VAT if he is a reseller of natural gas within the meaning of § 3g. With regard to the supply of electricity mentioned in paragraph 2 number 5 lit. b, the recipient shall be liable for VAT in cases where the supplying taxable person and the recipient are resellers of electricity within the meaning of § 3g. In the cases mentioned in paragraph 2 number 8 sentence 1, the recipient shall be liable for VAT regardless of whether he uses the purchased supply for a supply provided by him within the meaning of paragraph 2 number 8 sentence 1, if he is a taxable person who provides respective supplies on a sustained basis; this can be assumed, if the responsible tax office has issued him with a certificate in this respect that he is taxable person who provides respective supplies, which certificate is valid at the time of the performance of the transaction and for a maximum term of three years and can only be cancelled or withdrawn with future effect. With regard to the supply of services mentioned in paragraph 2 number 12 sentence 1, the recipient shall be liable for VAT if he is a taxable persons whose main business activity, with regard to the acquisition of these supplies, is their supply and whose own consumption of these supplies is of secondary importance; this can be assumed, if the responsible tax office has issued him with a certificate in this respect that he is taxable person who provides respective supplies, which certificate is valid at the time of the performance of the transaction and for a maximum term of three years and can only be cancelled or withdrawn with future effect. Sentences 1 to 6 shall also apply, subject to sentence 10, if the supply is received for the non-business sphere. If the recipient and the taxable person providing the supply have both assumed, where some doubt existed, that the conditions set out paragraph 2 numbers 4, 5 lit. b, and numbers 6 to 12 have been met, even though this was incorrect based on the type of transactions involved and applying objective criteria, the recipient shall still be deemed to be the taxable person, provided this does not result in a loss of tax revenue. Sentences 1 to 7 shall not apply if VAT is not levied on the taxable person executing the transactions in accordance with § 19 paragraph 1. Sentences 1 to 9 shall not apply when one of the goods referred to in paragraph 2 numbers 2, 7 or 9 to 11 is supplied by the taxable person under the conditions set out in § 25a. In the cases referred to in paragraph 2 numbers 4, 5b, and numbers 7 to 12, legal entities governed by public law shall not be liable for VAT, when the supply is provided for the non-commercial sector.

(6) Paragraphs 1 to 5 shall not apply if the supply provided by the taxable person resident abroad consists of

1. passenger transport that has been subject to the individual transport taxation method (§ 16 paragraph 5);

2. passenger transport carried out by a vehicle referred to in § 1b paragraph 2 sentence 1 number 1;

3. cross-border air passenger transport;

4. the granting of admission to trade fairs, exhibitions and conferences in Germany;

5. a supply of service rendered by a coordinating company to a taxable person resident abroad, where such service is associated with the organisation of trade fairs and exhibitions in Germany; or

6. in the serving of food and beverages for local consumption (restaurant service), when this provision takes place on board a ship, in an aircraft or on a train.

(7) A taxable person resident abroad, within the meaning of paragraph 2 numbers 1 and 5, is a taxable person who neither has his permanent address, nor usually resides, nor has a registered office, place of management or a fixed establishment in Germany, the Island of Helgoland or one of the territories referred to in § 1 paragraph 3; this also applies where the taxable person has his permanent address or usually resides in Germany but has his registered office, place of management or a fixed establishment abroad. A taxable person established in another Community territory is a taxable person who has his permanent address, usually resides, has a registered office, place of management or a fixed establishment in territories in the other Member States of the European Union which, according to Community law, are deemed as national territories of these Member States; this shall not apply if the taxable person exclusively has his permanent address or usually resides in the territories of the other Member States of the European Union which, according to Community law, are deemed as national territories of these Member States, but has his registered office, place of management or a fixed establishment in the territory of a third country. If the taxable person has a fixed establishment in Germany and if he executes a transaction in accordance with paragraph 1 or paragraph 2 number 1 or number 5, with regard to this transaction he shall be deemed as established abroad or in another Community territory if his fixed establishment is not involved in this transaction. The decisive factor shall be the point in time when the supply is provided. If it is doubtful as to whether the taxable person meets these conditions, the recipient shall not be liable for VAT only if the taxable person provides the recipient with a certificate stating that he is not a taxable person within the meaning of sentences 1 and 2, which certificate has been issued by the tax office which is, according to the regulations set out in the Fiscal Code, responsible for the taxation of his transactions.

(8) When calculating the VAT §§ 19 and 24 are not to be applied.

(9) In order to simplify the taxation procedures, the Federal Ministry of Finance, with the consent of the Federal Council, may issue a directive stipulating under which conditions a person other than the recipient is the person liable for VAT according to paragraph 5, in cases where a person other than the recipient pays the consideration (§10 paragraph 1 sentence 3).

(10) The Federal Ministry of Finance, with the consent of the Federal Council, may issue a directive extending the scope of the tax liability of the recipient, in accordance with paragraphs 2 and 5, to cover further transactions if many of these transactions raise the suspicion of a particularly serious case of tax evasion likely to result in significant and irrecoverable reductions in tax revenue. The conditions for such an extension are

1. the extension may not take effect before the European Commission has issued a notification that it has no objections against the extension, in accordance with Article 199b paragraph 3 of Council Directive 2006/112/EC from 28 November 2006 regarding the common system of value added tax (OJ L 347 of 11 December 2006, page 1) as amended by Article 1 number 1 of Directive 2013/42/EU (OJ L 201 of 26 July 2013, page 1),

2. the Federal Government has submitted a request for the Council to grant an authorisation in accordance with Article 395 of Directive 2006/112/EC as amended by Article 1 number 2 of Directive 2013/42/EU (OJ L 201 of 26 July 2013, page 1) permitting the Federal Republic of Germany, by derogation from Article 193 of Directive 2006/112/EC as amended by Directive 2013/61/EU (OJ L 353 of 28 December 2013, page 5), to introduce a tax liability for the recipient with regard to the transactions covered by the extension in accordance with number 1, with a view to avoiding any tax evasion;

3. the directive shall cease to be effective after nine months if authorisation in accordance with number 2 has not been granted; if authorisation has been granted in accordance with number 2, the directive shall cease to be effective as soon as the statutory ruling implementing the authorisation in national law takes effect.