German Sales Tax and Input Tax: Possible Retroactive Invoice Correction

Written By: Anka Hakert, Esq.

WINHELLER Attorneys at Law

Frankfurt, Germany

Sales Tax and Input Tax: Retroactive Invoice Correction Possible

A verdict issued by the Financial Court of the State of Lower Saxony allowed the retroactive correction of invoices, thus making a retroactive input tax deduction possible.

Often times, invoices created by entrepreneurs don‘t match the legal requirements of the German Sales Tax Act. The entrepreneur who received the invoice might thus not get the input tax refund from the German Tax Office, despite declaring the sales tax in the invoice. Even correcting the invoice wouldn’t help – at least not retroactively. To date, the fiscal administration holds the opinion that a corrected invoice does not have any retroactive effect.

The Financial Court of the State of Lower Saxony doesn’t share that point of view. A retroactive invoice correction is permissible, as long as the appropriate fiscal authority has not issued a final decision regarding the input tax deduction and as long as the invoice issued contains the mini-mum data as required by law. Said minimum data includes data about the individual issuing the invoice, the beneficiary, a detailed specification of service, as well as the remuneration and the separately declared sales tax.

Financial Court of the State of Lower Saxony, Judgement delivered on September 30th, 2013 – Case 5 V 217/13

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