• Service: Tax, Global Indirect Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 5/30/2014

Germany - Effects of insolvency proceedings involving VAT group 

May 30:  Germany’s federal tax court (BFH) addressed the effects of the opening of insolvency proceedings against an existing value added tax (VAT) group.

The case involved insolvency proceedings regarding assets of a holding company and its subsidiary companies. The position of the tax authorities assumed the continued existence of the VAT group, so that the holding company was required to continue to pay taxes during the insolvency proceedings on the supplies made by the subsidiary companies.

The BFH, however, found the VAT group no longer existed because the holding company was no longer able to enforce its will in the VAT group.

Read a May 2014 report [PDF 420 KB] prepared by the KPMG member firm in Germany: VAT Newsletter (May 2014)

The KPMG report also discusses the following topics:

  • Input tax deduction from services for operating a company canteen
  • Sufficient description of the supply in the invoice - reference to other business documents
  • Zero-rated intro-Community supply of new vehicles supplied to private individuals

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