Federal Ministry of Finance: When is VAT chargeable on partial supplies and instalment payments?

In its letter of 14 December 2022, the German Federal Ministry of Finance (BMF) responds to the recent jurisprudence of both the German Federal Fiscal Court (BFH) and the ECJ on the incurrence of VAT in the case of partial supplies and instalment payments. The BMF follows the BFH’s decision. Thus, even in the case of agreed instalment payments, VAT is already chargeable, in full, at the time the supply is rendered. Taxable persons seeking to control the incurrence of VAT will have to think about alternative structuring.

Source: KMLZ

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