German distance sales. VAT on e-commerce
You can find more information about the EU wide VAT regime on distance sales in our article about this topic in our website.
These are some of the rules applicable in Germany regarding this regime:
- The distance sales threshold is €100,000. Where the total amounts of sales to German customers in any 12 month period exceeds this threshold, a registration is required.
- Foreign companies may opt to register in Germany before the threshold is exceeded (the business must remain registered for at least 2 years). German companies may opt to register abroad if the threshold not exceeded, this option is also mandatory for 2 years once the application is sent and the German authorities must be informed in writing about the use of the voluntary registration in the country of arrival.
- When a foreign e-commerce business registers in Germany, a compliant VAT invoice must be issued for each German client. It is not allowed to issue a “simplified invoice”.
- Intrastat returns are due when the intrastat threshold is exceeded.
- VAT returns must report the sales as domestic sales only. Distance sales are not reported as intra-Community acquisitions followed by local sales.
- If goods are returned by the client, an intra-Community supply is not reported in Germany.
- An ESL return is never due on distance sales.