- Margin taxation under Section 25 German VAT Act applies mandatorily to travel services supplied in one’s own name using third-party travel services, including in B2B situations.
- Only the margin is taxed; input VAT deduction on the purchased travel services is excluded.
- The scheme generally requires a typical travel package with transport or accommodation services.
- If another main service dominates, such as participation in a trade fair or conference, margin taxation does not apply.
- The pending issue is whether margin taxation also covers loss-making travel services, such as “coffee trips,” which finance transport costs through sales events; the BFH has referred the question to the CJEU.
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.
Latest Posts in "Germany"
- German Court Bars VAT Refunds for Foreign Companies
- Transfer Pricing Adjustments and VAT: New Risks, New Action Needed
- Reduced VAT on Hotel Services: Breakfast and Wellness Excluded
- Germany Publishes Pre-Release of XRechnung 4.0
- Declaratory Interest After Failure to Forward an Invalid Input Tax Refund Application
