Latest VAT News
Here, we regularly inform you about new court decisions and other newsworthy developments in VAT matters.
EuG endorses bringing forward input VAT deduction
20 February 2026
According to the decision T-689/24 of 11 February 2026 of the European Court (EC), input VAT deduction can already be claimed in the tax period in which the supply was received if the invoice is available in a later period but before the tax return is submitted. This turns the previous practice on its head.
Import VAT accrual in centralised customs clearance
13 February 2026
The Union Customs Code provides for simplified central customs clearance, whereby customs declarations can be submitted in an EU Member State other than the one in which the goods are presented. The new § 21b of the Value Added Tax Act (UStG) regulates what applies to import VAT in this case.
Benefits of a cost-sharing group
Services provided by an independent group of persons to its members who perform certain VAT-exempt services in the public interest may also be VAT-exempt. According to the ECJ, the fact that the services are not exclusively linked to the VAT-exempt activities on account of their general nature is irrelevant (judgement C-379/24 and 380/24 of 22 January 2026).
Hobby as an economic activity
12 January 2026
In its ruling of 9 July 2025, published unofficially on 18 December 2025 (XI R 32/22), the federal fiscal court ruled on a case concerning the status as a VAT taxable person in connection with the renovation of a castle.
VAT rate reduction for the gastronomy industry
8 January 2026
On 19 December 2025, the Federal Council in Germany approved the Tax Amendment Act 2025. This means that from 1 January 2026, restaurant and catering services (with the exception of the sale of beverages) will be permanently subject to the reduced VAT rate of 7%. Beverages will remain subject to the standard tax rate of 19% (section 12 (2) No. 15 UStG, new version).
Factoring with collection as partial loan
12 December 2025
On 23 October 2025, the ECJ ruled on the Finnish case A Oy (C-232/24), which concerned various types of factoring with collection of the claim. The question to be clarified was whether the service consisted entirely of the taxable collection of claims, or whether it included a VAT-exempt loan.
Educational services: BMF circular dated 24 October 2025
12 December 2025
On 1 January 2025, § 4 No. 21 of the German Value Added Tax Act (UStG) on educational services was amended. The legislator responded to infringement proceedings, according to which the previous German regulations did not comply with EU law. It was clear from the outset that this new version would require interpretation by the tax authorities. On 24 October 2025, the circular from the Federal Ministry of Finance was finally published.
BMF circular on e-invoicing
28 November 2025
Exactly one year after its circular dated 15 October 2024, the BMF (Federal Ministry of Finance) has published another circular on e-invoicing. It incorporates the new legal regulations that have been in force since 1 January 2025 into the German VAT Implementation Regulations, supplements the previous version on a number of points and focuses on technical validation.
VAT exemption for an unauthorised private hospital
27 November 2025
In its ruling of 8 July 2025, published on 27 November 2025 under file no. XI R 36/23, the Federal Fiscal Court in Germany (BFH) ruled on the possible VAT exemption of services provided by a private hospital that was not licensed under § 108 of the German Social Code, Book V (SGB V).