- Small businesses are tax-exempt if their turnover did not exceed €25,000 in the previous year and does not exceed €100,000 in the current year.
- If turnover exceeds €100,000, the small business regulation ends, and standard taxation applies.
- Input tax deduction is not allowed for services received before transitioning to standard taxation, even if the transition is likely but not yet occurred.
- Input tax adjustments (Section 15a UStG) are only possible after the actual transition, subject to de minimis limits.
- The BMF updated the UStAE; transitional rules apply for VAT returns submitted by November 10, 2025, and small business invoices can now be issued with less information.
Source: hub.kpmg.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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