A mixed use exists for real estate if the property serves both VAT-paying and VAT-free purposes. The VAT may then be deducted only in proportion to the share of use subject to VAT. Section 15(4), third sentence of the UStG provides for a special scheme for the distribution of input tax on mixed-use properties. We explain how it works.
We explain how renting a property affects sales tax and where benefits and risks can arise.
Pre-tax amounts can be divided into three categories.
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.