Inventory sale at VuV
April 13, 2016 | 50,00 EUR | answered by Grit Weidauer
In the context of a real estate acquisition, inventory worth 10,000 euros is acquired. The property is leased to a business owner for their company with a waiver of VAT exemption. The inventory is deducted at a rate of 33% per annum from rental income. After 2 ½ years, the remaining book value of the inventory is 3,334 euros.
During a change of tenants, the inventory is removed and sold for 5,000 euros after a quarter of a year.
How should the proceeds of 5,000 euros be treated a) for VAT purposes and b) for income tax purposes?
The question that arises at first is whether the property was acquired with a waiver of VAT exemption. If so, was the inventory acquired as taxable, subject to tax, and not tax-exempt, and a input tax deduction taken.
You write that the inventory was removed with a change of tenant. This is probably to be understood as a private withdrawal of the inventory?
For VAT, § 15a UStG applies, i.e. a correction of the input tax deduction must be made at the time of withdrawal.
For income tax, § 23 (1) No. 2 sentence 4 EStG must be considered. Since the inventory was used for income and the acquisition was only 2 1/2 years ago, a disposal transaction must be declared under § 23 upon disposal (in this case, withdrawal does not constitute a disposal).
I hope I was able to shed some light on the matter. To have a detailed individual case review and calculation done, you should contact a tax advisor directly.
Best regards,
Grit Weidauer
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