VAT liability for unduly charged VAT also possible when negative VAT amounts are shown

A negative VAT amount shown on an invoice – for example, as a reduction in payment in the form of a bonus – does not give rise to a VAT liability under sec. 14c of the German VAT Act. At least, this is what the German Federal Fiscal Court (BFH) decided in its judgment of 26 June 2019 (XI R 5/18). According to its letter of 18 April 2023, the German Federal Ministry of Finance (BMF) takes a somewhat more differentiated view: The BFH’s statement should only apply if the issuer of the invoice actually invoices for a reduction in payment. If, on the other hand, he (unjustifiably) invoices a negative amount for a supply that he has supposedly provided, this should give rise to a VAT liability in accordance with sec. 14c of the German VAT Act. In the case of invoicing by means of a self-billing invoice, the BMF does not consider the BFH ruling to be applicable, so that a VAT liability under sec. 14c of the German VAT Act can also arise in this instance.

Source: KMLZ

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