Unlike most EU countries, Germany only restricts VAT deduction on a few items. In general, input VAT incurred in the course of a business in hotel expenses, restaurants, attendance to conferences, telephone, taxi or entertainment is 100% deductible.
The following items are not VAT deductible:
Any other input VAT is fully deductible as long as it is incurred as part of a business activity. Where the business use of an item is below 10%, this item is generally not deductible.
Input VAT prior to start a business (eg before a VAT registration) may be deductible, however, this should be agreed with the competent tax office, particularly for material amounts.