difference taxation
May 28, 2016 | 50,00 EUR | answered by Steuerberater Udo Glinka
My questions revolve around the topic of differential taxation.
I am currently setting up an online shop for used LP/CD/DVD. I have been sourcing goods exclusively from private individuals, thus opting for differential taxation for tax purposes. Since the purchases are only small amounts (usually up to 100 EUR), I will use the total sum calculation (sales minus purchases) to determine the value added tax.
Sales are made to private individuals worldwide.
I have now been offered a larger quantity from a business liquidation with an invoice and indicated value added tax.
This raises the following questions:
1. Is it permissible to use the total sum calculation for used items and parallel to that, standard taxation for "new items"? (Separate recording of purchases and sales is of course mandatory, as well as separate invoices depending on the taxation basis).
2. If the answer to 1) is no: Does the purchase invoice with VAT gross amount flow into the total sum calculation?
3. Do sales in the EU or other countries need to be separately indicated in the VAT declaration? If yes, where exactly?
4. When talking about the total sum calculation, it always refers to the settlement period. Is this the calendar year or the month?
Thank you for your efforts!
Dear inquirer,
Based on the information provided to me, I will answer your inquiry as follows and provide my initial assessment below.
According to § 25a of the Value Added Tax Act (UStG), the following conditions must be met in order for the margin scheme to be applied:
1. You must be a reseller.
2. The goods in question must be delivered to you within the European Community and VAT must not have been owed (e.g. by private individuals), not charged according to § 19 USt (so-called small businesses) or the margin scheme has been applied.
This means that if you now purchase goods with VAT included, you cannot apply the margin scheme, but must apply the standard taxation if you are not a small business. This means you can claim input tax from the purchase invoices and must tax the sales.
So, the answer to your question is yes, standard taxation can and must be applied in parallel.
There is an exception for certain art objects, collectibles (e.g. stamps, coins), or antiques. You could opt for the margin scheme for these items, even if you purchase them subject to VAT.
In the income statement, taxable and non-taxable turnover must be shown separately (line 12 and line 13).
In the VAT return, the tax-exempt portion from the margin scheme is not entered, only the 'margin'.
The total amount calculation refers to the tax period, which is usually the fiscal year when preparing an income statement.
I hope I was able to assist you with my explanations.
Kind regards,
Udo Glinka (Tax Advisor)
