The input tax deduction is subject to certain conditions according to the VAT Act (UStG). Entrepreneurs can sometimes only partially deduct the sales tax charged by other entrepreneurs. If, following a deduction made, the conditions governing this change, a correction to the input tax is necessary. All relevant regulations can be found in § 15a UStG.
According to § 15 paragraph 1b, 2 and 4 UStG, the deduction of input tax of an entrepreneur who receives the services of another entrepreneur is wholly or partially limited. With § 15 paragraph 2 no. 1 UStG, for example, the legislature stipulates that the tax-free land lease according to § 4 no. 12 sentence 1 letter a UStG excludes the deduction of input tax on related input services.
Decisive for the assessment of the VAT deduction is the entrepreneur’s forecast at the time of receipt of benefits (section 15.2c paragraph 12 sentence 1 UStAE). If, within the so-called forecast period of five or ten years, the circumstances assumed or present at that time change, a so-called pre-tax correction is required according to § 15a (1) sentence 1 UStG. The trader must therefore adjust the deduction already made to the actual circumstances.
The following forecast periods apply:
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.