What do I need to consider when selling goods abroad?
May 29, 2023 | 40,00 EUR | answered by Dietrich Hohenadel
Dear tax consultant,
My name is Emil Rademacher and I run a small business that also sells goods abroad. Lately, I have heard that there are some particularities to consider regarding value added tax when selling abroad. I am unsure if I am doing everything correctly and want to make sure I don't encounter any legal issues.
So far, I have only sold goods within Germany and calculated the applicable value added tax. Now, I want to expand and export abroad. I have heard that there are special regulations here, such as concerning the VAT identification number and the tax treatment of exports.
I am worried that I might be doing something wrong and could face high fines or tax repayments as a result. Therefore, I would like to know from you what specific steps I need to take in order to correctly sell goods abroad. Are there any specific forms that I need to fill out? Do I need a VAT identification number? How can I ensure that I calculate the correct value added tax?
I look forward to your helpful tips and advice so that I can successfully expand my business abroad without encountering any tax issues.
Thank you in advance.
Best regards,
Emil Rademacher
Dear Mr. Rademacher,
Thank you for your inquiry regarding the sale of your goods abroad and the associated value-added tax. It is understandable that you are considering the special regulations and rules to avoid legal issues. Therefore, I will explain in detail the steps you need to follow to correctly sell goods abroad.
First of all, it is important to know that different regulations apply when selling goods abroad compared to selling within Germany. When exporting goods to a non-EU country, German VAT is completely waived. Therefore, you do not need to show VAT on your invoices. Instead, you need to take care of customs formalities and possibly pay import duties in the destination country.
On the other hand, when selling goods to an EU country, you need to ensure that you handle VAT correctly. This is where the VAT identification number (VAT ID) comes into play. You need this number to deliver goods tax-free to companies in other EU countries. You can apply for the VAT ID at the Federal Central Tax Office.
To ensure that you calculate the correct VAT, you first need to determine whether it is an intra-community acquisition (within the EU) or an export (outside the EU). For intra-community acquisitions, you need the customer's VAT ID and must declare the delivery in your VAT return. For exports, you need to submit an export declaration to customs.
Additionally, you should adjust your accounting and invoicing accordingly to comply with the regulations. It is advisable to seek support from a tax advisor to ensure that everything is done correctly.
I hope this information helps you and enables you to successfully expand your business abroad. If you have any further questions, I am happy to assist.
Best regards,
Dietrich Hohenadel
