- For electricity supplied to households at social tariffs, the legally fixed, supported price is to be used for VAT purposes, and the normal value regulation (Section 4, Paragraph 9 of the German VAT Act) does not apply as the tariff structure is not based on external motives.
- The settlement agency, acting independently and for remuneration by providing administrative services, is considered an entrepreneur under Section 2 of the German VAT Act and must invoice its services to electricity suppliers subject to VAT based on a distribution key.
- The settlement agency’s assumption of social tariff benefits constitutes a separate taxable service, and any disproportionate supplies to beneficiary households or disproportionately low supplies result in taxable remuneration between the supplier and the settlement agency. Additionally, compensation for operating expenses (Section 38 (5) ElWG) is considered a taxable fee from the settlement agency to the suppliers.
Source Leitner & Leitner
Latest Posts in "Germany"
- ECJ Rules Transfer Pricing Adjustments Aren’t Automatically Subject to VAT
- The Planned VAT Reform “21-10-0”: Implications and Risks
- Guest Cards as Multi-Purpose Vouchers under German VAT Law
- VAT Liability: What a GmbH Managing Director Needs to Know
- Cross-Border Second Factoring versus Receivables Sale: Düsseldorf Tax Court Ruling
