Warranty commitments granted for remuneration as insurance transaction

In two letters dated 11 May 2021 and 18 June 2021, the tax authorities have adopted the latest decision of the Federal Fiscal Court regarding warranty commitments granted for remuneration originating from the practices in the motor vehicle trade. The tax authorities have made it clear that the new principles will apply across all sectors and thus also beyond the motor vehicle trade, with far-reaching consequences for VAT and insurance tax. The new
rules will be mandatory for all warranty commitments issued after 31 December 2021.

Source WTS

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