Which products are exempt from value-added tax?
July 13, 2023 | 40,00 EUR | answered by Günther Hering
Dear tax advisor,
I am Lucas Krebs and I operate a small online shop where I sell various products. Lately, I have been delving deeper into the topic of value added tax and I am wondering which products are actually exempt from value added tax. I have already done some research, but I am unsure if my products could potentially fall under this regulation.
Currently, I mainly sell clothing, shoes, and accessories in my shop. Some of my customers have already asked me if the prices include or exclude value added tax, and I want to ensure that I provide accurate information. Additionally, I am concerned that I may have incorrectly calculated and paid value added tax, which could lead to legal consequences.
Therefore, I would like to know from you which products are exempt from value added tax and if my products could fall under this regulation. Are there specific requirements that need to be met in order to be exempt from value added tax? What steps should I take to ensure that I handle everything correctly and avoid any issues with the tax authorities?
I thank you in advance for your help and expertise.
Best regards,
Lucas Krebs
Dear Mr. Krebs,
Thank you for your inquiry regarding value added tax and which products are exempt from this tax. As a tax advisor specializing in value added tax, I am happy to assist you.
In general, all goods and services in Germany are subject to value added tax, unless there is a specific exemption. Products that are usually exempt from value added tax include essential goods such as food, books, newspapers, medicines, some cultural events, and certain services in the healthcare sector. However, clothing, shoes, and accessories do not fall into this category and are therefore generally subject to the regular value added tax.
It is important to note that value added tax is passed on to the end consumer, so your prices should always be stated inclusive of value added tax. If a customer asks whether prices are inclusive or exclusive of value added tax, you should clearly communicate this to avoid misunderstandings.
To ensure that you calculate and pay the value added tax correctly, I recommend consulting a tax advisor who can assist you with accounting and tax returns. It is important to accurately document all income and expenses and ensure that your VAT returns are submitted to the tax authorities on time.
If you are unsure whether your products may be exempt from value added tax, I recommend contacting your tax advisor for a thorough examination. It is better to clarify all questions in advance to avoid potential issues with the tax authorities.
I hope this information is helpful to you and I am available for further questions.
Best regards,
Günther Hering, Tax Advisor
