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Frequently Asked Questions

Value Added Taxation

Do foreign artists or tour promoters in Germany need to bill VAT on their earnings in Germany?

No. The domestic business person owes the VAT in Germany (corresponding to the EU VAT guidelines) on the services of the independent artist and promoter from abroad (reverse charge). To the extent that he/she is entitled to the pre-tax deduction, he/she will receive the VAT reimbursement from his/her responsible tax office through the pre-tax deduction and will not be financially burdened with the tax.



Am I required to mention VAT in my contracts?

You may not bill the German contracting partner for the VAT under any circumstances. In that case the VAT would have the effect of increasing your earnings with the result that you would owe withholding tax on the VAT (which you do not owe anyway). However, under German VAT law, you are obligated to remind your domestic contracting partner of its tax liability. The following clause is recommended for your contract: “The contracting party as the recipient of services is obligated to pay the VAT”.
For other questions, see the index: taxation/value added tax    
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