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Status 1 July 2021: Notices on value added tax (VAT) refund procedures after the United Kingdom withdrawal from the EU (Brexit)

The United Kingdom has left the EU at the end of 31 January 2020. You had to submit refund applications for periods regarding calendar year 2020 according to the Council Directive 2008/9/EC of 12 February 2008 until 31 march 2021. Applications relating to refund periods from 2021 onwards must be submitted in accordance with the rules for VAT refund to businesses from third countries.

Exception for Businesses established in Northern Ireland:

The agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community and the Northern Ireland Protocol includes special arrangements for trade in goods which remain valid beyond 31 March 2021. Businesses established in Northern Ireland must submit refund application concerning VAT on goods according to Council Directive 2008/9/EC of 12 February 2008.

The rules for VAT refund to businesses from third countries shall apply for reimbursement of VAT on services.

Status 28 October 2020: Amended provisions on the date by which corrected invoices must be submitted

If you have submitted an invoice that does not meet the regulations of Sec. 14 Par. 4 Umsatzsteuergesetz (i.e. VAT Act), and VAT is therefore not refundable, you have the possibility to have the invoice corrected by the invoice issuer and to reclaim VAT refund from the corrected invoice.

You can find here what you have to observe from now on in the event of an invoice correction:

I. In which cases do you have to apply for VAT refund from the corrected invoice for the refund period in which the service was received and the invoice was first issued?

The correction to an invoice shall take effect from the date on which the service was received and the the invoice was first issued if the following details are already included in the original invoice:

• invoice issuer (= service provider / supplier),
• invoice recipient,
• specifications of services,
• remuneration (= taxable amount) without VAT and
• separately shown VAT.

After the correction of the invoice, the VAT refund must be reclaimed for the refund period in which the service was received and the invoice was first issued (Part 15.2a Par. 7 Umsatzsteuer-Anwendungserlass (i.e. VAT Application Decree)).

Please note:
The VAT refund from an invoice that has been corrected retroactively can only be granted if no finality has yet occurred at the relevant refund period. Therefore, if you need to have an invoice corrected retroactively, you should, as a precautionary measure, lodge an appeal against the decision rejecting the refund from the original invoice in order to meet the deadline.

Transitional provision:
If the corrected invoice is received by the invoice recipient by 31 December 2020, it is also possible to reclaim the VAT for the refund period in which the invoice issuer corrected the invoice in accordance with Sec. 31 Par. 5 Umsatzsteuer-Durchführungs-verordnung (i.e. VAT Implementing Regulation). You do not have to submit the corrected invoice retroactively to the refund period in which the invoice was first issued.

II. In which cases do you have to apply for VAT refund from the corrected invoice for the refund period in which the invoice was corrected?

If an invoice is incomplete in one or more of the following characteristics, its correction shall not retroactively effect the date on which the service was received and the invoice was first issued but takes effect from the time of correction:

• invoice issuer (= service provider / supplier),
• invoice recipient,
• specifications of services,
• remuneration (= taxable amount) without VAT and
• separately shown VAT.

After the correction of the invoice, the VAT refund must be reclaimed for the refund period in which the invoice issuer has corrected the invoice and the invoice recipient has received the corrected invoice (Part 15.2a Par. 7 Umsatzsteuer-Anwendungserlass (i.e. VAT Application Decree)).

III. How to correct an invoice

There are three possibilities for correcting deficient invoices:

1. Correction made directly on the invoice
   
   Every correction made directly on the invoice must be confirmed by the issuer of the invoice with his company stamp, date and signature. In the case of an invoice correction, the changed data must still be visible on an invoice. Over-sticking of data by means of stickers or overwriting is not permitted.

2. Issue a document that is clearly and specifically related to the invoice to be amended
   
   

   The document is clear and specific to the invoice to be amended, if the consecutive number of the original invoice is indicated in this document. The document must comply with Sec. 14 Par. 4 Umsatzsteuergesetz (VAT Act), i.e. it must contain in particular the date of issue. However, a new invoice number for the amending document is not required.

3. Issue a new invoice with date of reissue
   
   A new invoice may be issued, which must contain a clear reference to the original invoice.

Application

General requirements

Businesses that are not established in an EU Member State can use the VAT refund procedure in certain cases.

The requirement for this is:

• The country in which the company is established reimburses VAT (value-added tax) to German businesses or does not collect VAT (known as reciprocity).

In the BMF letter dated 15 March 2021, you can read which countries fulfill this requirement and which do not.

If the reciprocity requirement with your country of establishment is not fulfilled, you may only submit an application if you participate in the VAT on eServices/ECOM special provision.

Eligible applicants

You can participate in the VAT refund procedure if you meet the following requirements:

• You are registered as a businesses in a Non-EU Member State
• You have neither your headquarters nor management in Germany or in another EU Member State,
• You have no fixed establishment in Germany or in another EU Member State from which supplies of goods and services subjekt to German value-added tax are made in the territory of the country.
• You are not registered in Germany for VAT purposes, or you are registered in Germany for VAT purposes, but you did not make any supplies in Germany in the year in question except for those mentioned below (see next bullet)

• You make no supplies transactions in Germany with the exception of

  • supplies of goods and services for which the purchaser or customer must pay VAT or
  • transactions that are subject to individual transport assessment or
  • intra-Community acquisitions in Germany and then associated supplies of goods as part of intra-Community triangular transactions, or
  • services that fall under the VAT on eServices/ECOM provision.
  • o services that fall under the Import-One-Stop-Shop provision.

Form

VAT refund applications are to be submitted electronically via the BZSt online portal (BOP) of the Federal Central Tax Office (BZSt). Before you can use the BOP, you must register once with the BZSt for using the BOP.

You must list the VAT amounts individually in the application (known as an itemized schedule). This means that you must enter every invoice and every import receipt.

Refund period

Refund periods must include at least three consecutive calendar months in a calendar year. They may not exceed one calendar year. The period can be less than three months if the period is the remaining period of a calendar year.

The periods of applications may not overlap. Exception: If you have submitted a refund application for the calendar year or for the last period of the calendar year, you can submit one other refund application for that year. The only VAT amounts that can be included in this application are VAT amounts that are not included in past refund applications that were effectively submitted.

Minimum amount

The refund that is applied for must be at least EUR 1,000. The refund that is applied for must be at least EUR 500 for refund periods that are the calendar year or the last period of the calendar year.

Application deadline

You must apply for a refund within six months after the end of the calendar year in which the VAT was incurred. This means the BZSt must receive electronically transmitted applications as well as original receipts transmitted by conventional mail before this deadline. This deadline will not be extended.

Completion of processing

After the application is processed, the applicant or the applicant’s agent will receive notice about the decision that was made. The notice will then be dispatched to the address indicated on the application.

Required documents

• Original invoices and import receipts from which the refund amounts that were applied for were taken. Please submit all receipts in full. It is not sufficient to only transmit some of the pages.
  The receipts must be numbered consecutively. The numbering must agree with the sequence in the attachment to the application (itemized schedule).

• Official documentation from your country of residency that confirms that you are registered as a business in your country of establishment with a tax number (known as a certificate of status of taxable person)
  The certificate of status must cover the refund period that was applied for and contain the following information.

  • applicant’s name
  • pplicant’s complete address
  • applicant’s business activity
  • applicant’s tax number (if applicant does not have a tax number, the foreign government agency must give the reason for that in the certificate)
  • date, stamp, and signature of the issuing government agency

Certificates of status are valid for one year as of the date of issue. A new certificate must be submitted for refund applications that are submitted later than one year after the date of issue of the certificate. Please send the documents by mail to the

Bundeszentralamt für Steuern
Dienstsitz Schwedt
Passower Chaussee 3b
16303 Schwedt/Oder
Germany

Submitting applications electronically

To be able to use the BZSt online portal (BOP) to transmit VAT refund applications electronically, you must first register once via the BZSt registration form for using the BOP.

Afterwards, you must register in the BOP with the access data that you received.

You can find details about signing up and registering under the "VAT refunds – electronic data transmission" heading.

Application

Log on to the website www.elster.de/bportal (BOP) with your BOP certificate and your password.

In the BOP, please select the form "Application for refund of VAT levied on foreign businesses (third countries) in Germany." You can use the help function in the BOP for more information about filling out the application form.

After the refund application has been successfully transmitted, you will receive a confirmation in your email inbox in the BOP that your refund application was accepted as well as a cover sheet for sending receipts for the refund application.

You must send the original invoices and import receipts that the electronic refund application is based on to the BZSt within the application deadline.

Please use the cover page that was put into your mailbox in the BOP to send the required documents. This makes it possible to allocate the receipts to the application that you transmitted electronically in the BOP.

Entering invoices and import receipts as an attachment to the application

You have two options available to enter the attachments to the application:

• You enter each invoice / each receipt individually in the refund application or
• You enter the invoices in advance in a CSV file and import the CSV file into the application. You can create the CSV file yourself, or you can use the Excel template provided in the application under Item 3 "Data import." Recommendation: Before you convert a completed Excel template into a CSV file, save the Excel template to be able to make any possible corrections easier at a later time.

Applications are limited to 1,000 positions on the BOP form. For applications that contain more than 1,000 positions, please verify whether it is possible to separate the application into several refund applications by dividing up the refund period. If it is not possible to divide up the refund period, please transmit several applications for the same refund period.

Help document

Provisions