Good to know!

SEPA - electronic payments

Since February 1st 2014, all credit transfers and direct debits in euro will be made under the same format.  Payments in the Euro Area will significantly become easier. For the Single Euro Payments Area = SEPA, national formats of transfers like the bank account number will be altered into the standards of IBAN (International Bank Account Number) and BIC (Business Identifier Code). They can be used in the 28 EU-States, in Iceland, Liechtenstein, Norway, as well as Monaco, Switzerland and San Marino. 

www.europeanpaymentscouncil.eu

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Where can I get my tax ID?

The German tax ID can be applied for at the tax office using the “Fragebogen zur steuerlichen Erfassung” (English: questionnaire for tax registration) to register one’s freelance/self-employment status in Germany. One can either visit the tax office or call to request the appropriate form or download the form from the German federal revenue administration website www.formulare-bfinv.de.

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Foreign bank transfers

Wire transfers from or to a foreign bank may be subject to transfer fees or losses due to currency exchange. Please contact the respective bank for information.

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Electronic invoices

As a result of the tax simplification law of 2011, invoices in Germany can be sent electronically – as an e-mail, text attachment, PDF or scan. They are recognized for taxes and are also valid without a qualified electronic signature. 

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“Ausländersteuer” (English: foreigner tax) on international co-productions

When engaging in international co-productions, it is worth calculating payment in the way that will result in the least amount of taxes on remunerations received. The “foreigner tax” in Germany is usually relatively low compared to other countries. Inquiring may pay off! Sometimes it is also possible for the respective co-production partners to manage the funds separately and for each to pay their fellow countrymen.

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How do I apply for a value added tax identification number?

When starting a business, a VAT identification number can be applied for directly when registering for tax purposes. If needed later, it can be obtained from the Federal Central Tax Office. The form “Antrag auf Erteilung einer Umsatzsteuer-Identifikationsnummer” (English: application for a value added tax identification number) can be downloaded from the office’s website www.bzst.de

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Where to declare a non-taxable/tax-free sale on a tax return?

Non-taxable sales can be entered under “Ergänzende Angaben zu Umsätzen” in line 42 “nicht steuerbare Umsätze (Leistungen nicht im Inland).”

Tax exempt sales, for example, in case of an intra-community sale of art works to a buyer with a VAT number, are declared in line 20 “innergemeinschaftliche Lieferungen.”

These sales must also be reported to the Federal Central Tax Office in the recapitulative statement www.bzst.de.

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VAT exemption for theaters

Facilities that serve the same cultural function as public theaters etc. are exempt from value added tax (§4 No. 20 – 22b UStG) – the same applies to independent ensembles, individual artists, individual productions, etc. The necessary certificate is issued by the respective federal state authority.
 Particularly organizers in Eastern Europe must pay higher taxes on artists that are subject to VAT in Germany. The exemption certificate simplifies the conclusion of a contract and higher compensation may be possible.

Insbesondere Veranstalter in Osteuropa müssen auf Künstlerinnen und Künstler, die in Deutschland umsatzsteuerpflichtig sind, höhere Steuern abführen. Mit der Bescheinigung wird ein Vertragsabschluss vereinfacht und ggf. ist eine höhere Gage möglich. 

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VAT exemption based on a “Gemeinnützigkeitsbescheinigung” (English: certificate of public interest)

Ensembles/collectives/galleries/companies who start a nonprofit association can achieve VAT exemption using a certificate of public interest. After founding the association, one applies for a certificate of public interest at the district court. This can then be used to obtain a notice of exemption at the responsible tax office.

(For information about the law of associations see, for example, the “Leitfaden Vereinsrecht” of the Federal Ministry of Justice and Consumer Protection (www.bmjv.de) – available in German only.)

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VAT exemption for stage directors and choreographers

Since July 1st 2013 the German annual tax law is in force. It exempts stage directors and choreographers from value added tax starting from 1st July 2013 pursuant to § 4 Nr. 20-22b UStG (English: Value Added Tax Act) if they work at public theaters. The draft was first rejected by the Bundestag (English: German Federal Parliament) because of contentious points, but the exemption is now in force. 

Practically this means: The exemption accounts for revenues made after the 30th of June 2013. The date of the service provision/performance is determining (not the date of invoce nor the date of the receipt of money).

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“Kleinunternehmerregelung” (English: small business regulation) abroad

Foreign-based, self-employed German artists are not subject to the small business regulation according to § 19 UStG. This regulation only applies to people whose permanent residence is in Germany. The tax laws of the respective country also may provide for preferential treatment or regulations for entrepreneurs with incomes below a certain threshold.  

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VAT rate in the art market

The reduced VAT rate of the German art market will be abolished for reasons relating to European community law. The new policy will introduce a 30% flat marginal tax rate, as it already exists in France. The reduced VAT rate of 7% still applies in 2013; the new regulation becomes effective in 2014.   

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