In a lengthy statement, the German Association of Tax Consultants has commented on the temporary reduction in VAT rates. The content of the text makes it clear that, according to the tax consultants, the change in VAT is (literally) a "bureaucratic super-GAU".
Uncertainty regarding the reduction in VAT rates
Tax advisors particularly emphasised the burden that the reduction in VAT rates would place on small and medium-sized companies. Above all, the continuing uncertainty on all sides regarding the regulations of the VAT rate reduction still prevails should be eliminated as quickly as possible. Considering that this will not actually happen until the Bundestag session on 29 June, the latter is more of a pious hope.
Missing accounts and manual effort
The tax consultants' association immediately sets out a number of demands that arise due to the short deadlines for implementing the measures to overcome the coronavirus crisis. According to the text, one sticking point is the conversion of accounting software or ERP systems to the new VAT rates (5 % and 16 %). Quote: "...For example, VAT accounts for recording intra-Community acquisitions, accounts for recording advance payments made or the reverse charge procedure are missing 16 % and 5 % respectively..." End quote. In their letter, the tax consultants also question whether all systems in Germany will be converted in good time. This would result in extensive manual work, so that a timely value added tax-advance return. To this end, the association is calling for an extended deadline for submitting the advance VAT return.
Impending violation of the GoBD
According to the tax consultants, the consequences of adjusting the VAT rates would possibly lead to a breach of the principles for the proper keeping and storage of books, records and documents in electronic form and for data access. (GoBD) lead. There would be a risk that it would not be possible to allocate business transactions promptly by means of account assignment if the chart of accounts adapted to the reduction in VAT rates is not yet available. The tax consultants' association is calling for a temporary suspension of the corresponding requirements.
Solution for SAP Business One
We are working flat out on a solution that will help SAP Business One users to temporarily reduce VAT.
[email-subscribers-form id="2″]
Conversion of cash registers to new VAT rates
Here, the Association of Tax Consultants assumes that a timely conversion of the Cash register systems will not be possible for all affected companies. Companies affected by this can correct incorrectly issued receipts, but this would fail in practice due to the effort involved. The association is therefore demanding that if cash registers are not converted to the new tax rates in good time, the business should only owe the legally owed VAT of 16 % or 5 % (despite overstating the tax).
In addition, the Tax Consultants Association is also calling for a postponement of the legal obligation to protect electronic recording systems (for digital cash registers) from manipulation by using certified technical security equipment (TSE).
Call for exceptions
Many companies have already calculated in advance which will be realised during the period of reduced VAT rates. One consequence of this would be invoice corrections. The tax advisors are calling for a special regulation to allow them to work with the higher VAT rates.
By way of exception, it should also be permitted for companies to pay only the statutory VAT due in the case of gross price agreements despite overstating the VAT on their invoice.
It is also proposed that exceptions be made for services provided across reporting dates. For example, it should be permitted to charge such services at the same VAT rate.
more on the subject:
SAP reacts to the Corona crisis with free access to the trading platform
Time to tidy up - optimise ERP software now (Part 1)
Learn with SAP for free
ERP projects despite or because of Corona
Reduction of VAT 2020
