Postponed accounting vs deferred payment for VAT
Your company imports goods in Germany ? Then, you probably know that postponed accounting via the VAT return is not possible in Germany. In principle, import VAT needs to be paid to the customs authorities upon importation (immediate payment is required). This cause an important cash flow issue for many taxpayers as the input VAT will have to be recovered through the periodic VAT return at a later stage.
There is however an alternative : a deferred payment for VAT and customs is possible under specific conditions.
Payment of the import VAT extended
Companies importing goods into Germany had to pay import VAT immediately to customs, or within 10 days of importation at the latest. By means of article 3 of the Second Law on Implementing Tax Aid Measures to Cope with the Corona Crisis (Second Corona Tax Aid Act) of June 29, 2020, a new paragraph 3a has been inserted in § 21 UStG - special provisions for import sales tax. Accordingly, the delay for the payment of the import VAT is now significantly extended.
Under the new rules, the import VAT will have to be paid on the 26th day of the second month following the month of importation (instead of the 16th day of the month following the month of importation).
In order to benefit of the payment delay, a so-called deferment account however has to be set up. A security is in principle required but for the calculation of the security, the import VAT amount may be disregarded if the importer can fully deduct it.
It is important to note that import VAT payable under the deferred payment scheme may already be deducted as input VAT in the VAT return for the period during which the import took place. For instance, in case of an importation in January, the input VAT may already be reported in the preliminary VAT return to be filed by 10 February (in case of monthly reporting) while the VAT due will have to be paid by 26 March only!
Source : BMF letter dated 06.10.2020- III B 1 - Z 8201/19/10001: 005
The measure is not automatic. In order to benefit from this extended deadline, importers must have a deferred payment account with German customs.