What are the most common sources of errors in input tax deduction?
November 30, 2023 | 30,00 EUR | answered by Phillip Buchner
Dear tax consultant,
I am reaching out to you because I am responsible for the input tax deduction in my company and I am unsure if I am doing everything correctly. I have some experience in dealing with input tax, but there are still uncertainties and questions that arise for me.
My current situation is as follows: We are a small to medium-sized company that regularly makes purchases and therefore wants to claim input tax regularly. I want to ensure that we do not make any mistakes in the input tax deduction and avoid potential financial disadvantages.
Currently, I am independently carrying out the input tax deduction, but I am not sure if I am considering all relevant points and not making any mistakes. I have already gathered some information on the topic, but there are always new aspects that are unknown to me and lead to uncertainties.
My concerns are that we could unintentionally make mistakes in the input tax deduction that could lead to financial disadvantages or even legal consequences. I want to ensure that we utilize all possibilities to correctly settle the input tax and avoid potential sources of errors.
Therefore, my question to you is: What are the most common sources of errors in input tax deduction and how can we avoid them? Are there specific points we should pay particular attention to and what tips can you provide to help us carry out the input tax deduction correctly?
Thank you in advance for your assistance.
Sincerely,
Katrin Kuhn
Dear Mrs. Kuhn,
Thank you for your inquiry regarding the input tax deduction in your company. As a tax advisor, I would like to help you and provide you with some tips to avoid potential errors in the input tax deduction.
One of the most common sources of errors in input tax deduction is incomplete or incorrect invoices. It is important that all invoices are issued properly and contain all legally required information, such as the correct invoice address, date of issue, description of the service, and the specified input tax amount. Therefore, make sure to use only complete and correct invoices in order to claim the input tax.
Another common mistake is the incorrect allocation of input tax amounts. It is important to claim input tax only for expenses incurred for business purposes and to exclude personal expenses. Therefore, make sure to use the input tax only for business expenses that were actually made within the scope of the company.
Furthermore, make sure not to claim input tax that has already been reimbursed elsewhere. It often happens that input tax amounts are claimed twice, which can lead to demands for repayment from the tax office. Therefore, make sure to deduct the input tax only once and correctly.
Additionally, I recommend regularly reviewing and documenting your accounting. Maintain a proper and comprehensive documentation of all purchases and expenses to identify and correct potential errors early on. Proper bookkeeping is essential for accurate input tax deduction.
Finally, I advise you to stay informed about current changes in legislation and case law related to input tax. Tax regulations can change, and it is important to stay up to date to avoid potential errors.
I hope these tips help you and you can carry out your input tax deduction error-free in the future. If you have any further questions, please feel free to contact me.
Best regards,
Phillip Buchner
