Section 6: Special schemes

§ 25a Margin scheme

(1) A taxation scheme shall be applied to the supply of moveable tangible goods within the meaning of § 1 paragraph 1 number 1 based on the following regulations (margin scheme), provided that the following conditions are met:

1. The taxable person acts as a reseller. A reseller is assumed to be any person who commercially deals with movable tangible goods or publicly auctions such goods on his own behalf.

2. The goods were supplied to the reseller in Community territory. For this supply

   1. VAT was not owed nor charged in accordance with § 19 paragraph 1, or

   2. the margin scheme was applied.

3. The goods are not precious stones (positions 7102 and 7103 of the customs tariff), nor precious metals (positions 7106, 7108, 7110 and 7112 of the customs tariff).

(2) The reseller may notify the tax authority, at the latest, by the filing of the first preliminary VAT return of a calendar year that he shall also apply the margin scheme to the following goods:

1. works of art (number 53 in Annex 2), collector’s items (number 49 lit. f and number 54 in Annex 2) or antiques (position 9706 00 00 of the customs tariff), which he has himself imported, or

2. works of art, if the supply made to him was subject to VAT and was not carried out by a reseller.

The declaration shall be binding on the taxable person for at least five calendar years.

(3) The transaction shall be assessed based on the amount by which the sales price exceeds the purchase price of the goods; in the case of a supply of goods, within the meaning of § 3 paragraph 1b, and in the cases as defined in § 10 paragraph 5, the value determined pursuant to § 10 paragraph 4 number 1 shall replace the sales price. If it is not possible to calculate the purchase price of a work of art (number 53 of Annex 2) or if the purchase price is not relevant, then the amount used to calculate VAT shall be 30 percent of the sales price. The VAT is not included in the consideration. The value within the meaning of § 11 paragraph 1, plus the import tax, shall be regarded as the purchase price in the case as defined in paragraph 2 sentence 1 number 1. In the case as defined in paragraph 2 sentence 1 number 2, the purchase price shall include the VAT of the supplier.

(4) The reseller may assess the total of the transactions carried out within a taxation period on the basis of the total amount by which the total of the sales prices and the amounts in accordance with § 10 paragraph 4 number 1 exceed the total of the purchase prices for this period (total margin difference). Taxation based on the total margin difference shall only be permissible in the case of such goods where the purchase price does not exceed Euro 500. Paragraph 3 shall apply accordingly.

(5) The tax is to be calculated using the standard VAT rate in accordance with § 12 paragraph 1. The VAT exemption, except for the VAT exemption for intra-Community supplies (§ 4 number 1 lit. b, § 6a), shall remain unaffected. By way of derogation of § 15 paragraph 1, the reseller is not entitled, in the cases as defined in paragraph 2, to deduct as input VAT the import tax due, the separately stated VAT or the VAT owed in accordance with § 13b paragraph 5, with respect to the supply made to him.

(6) § 22 shall apply under the condition that the following must be clearly evident in the records of the reseller:

1. the sales prices or the amounts in accordance with § 10 paragraph 4 sentence 1 number 1;

2. the purchase prices, and

3. the taxable amounts in accordance with paragraphs 3 and 4.

If the reseller applies, in addition to the margin scheme, the taxation method in accordance with the general regulations, he must keep separate records.

(7) The following special features shall apply:

1. the margin scheme shall not apply

   1. to the supply of goods that the reseller has acquired within the Community, if the VAT exemption for the intra-Community supply of goods was applied in another Community territory to the goods supplied to the reseller,

   2. to an intra-Community supply of a new vehicle within the meaning of § 1b paragraph 2 and 3.

2. the intra-Community acquisition shall not be subject to VAT, if the margin scheme has been applied to the goods supplied to the customer within the meaning of § 1a paragraph 1 in another Community territory.

3. the application of § 3c and the VAT exemption for the intra-Community supply of goods (§ 4 number 1 lit. b, § 6 a) shall be excluded from the margin scheme.

(8) The reseller may waive the option to apply the margin scheme for any supply, if he does not apply paragraph 4. If the said waiver relates to goods referred to in paragraph 2, the earliest date on which the input VAT deduction is possible shall be the preliminary VAT return period in which the supply is subject to VAT.