- The BMF’s 1 April 2026 guidance updates VAT-group rules in line with recent CJEU and BFH case law and amends section 2.8 of the VAT Application Decree.
- In a VAT group, internal services between the parent and subsidiaries are not taxable even if they are used for non-economic activities in the strict sense.
- This applies to both paid and unpaid internal services; such use also does not trigger a deemed supply/withdrawal.
- If input services are used for non-taxable internal supplies serving a non-economic area, input VAT deduction is denied and any prior deductions may need adjustment under Section 15a UStG.
- The BMF follows the courts’ view that activities outside VAT scope (e.g. sovereign/public authority tasks) are not “non-business” for these purposes.
Source: datenbank.nwb.de
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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