Changes to the application of the Tour Operators Margin Scheme (TOMS) in Germany

9 November 2015

The European Commission has issued a reasoned opinion requesting that Germany amend their VAT legislation on the application of a special scheme for travel agents, referred to as the Tour Operators Margin Scheme (TOMS), in order to bring it in line with the EU VAT directive. The scheme allows travel agents to account for VAT only on the profit margin element of their trade. The current German VAT legislation states that this scheme can only be applied to services provided direct to consumers and also allows travel agents to set one single profit margin for all supplies sold during a VAT return period. However, based on previous court rulings, the European Court of Justice stated that this application is incorrect and that TOMS should apply to services provided to business customers as well. The Court also stated that a travel agent should be able to calculate the margin per single travel service provided and not just on the whole VAT period.

LATEST NEWS

Danish decision on OSS compliance reinforces the...

A recent Danish Tax Appeals Tribunal decision has reinforced the importance of meeting VAT reporting obligations under the EU's One Stop Shop (OSS) regime. In...

SEE MORE
VAT news
LATEST NEWS

Italy extends deadline for recovering Input VAT

Under a new legislative decree issued in August, Italy introduced a positive law for businesses registered for VAT in the country. From 1 January 2027...

SEE MORE
VAT news
LATEST NEWS

Portugal clarifies VAT correction procedures and...

Portugal's Tax Authority has issued new guidance on VAT invoice corrections and introduced updates to the periodic VAT return, reflecting the country's...

SEE MORE
VAT news

Gated Content

The following email providers are not accepted: gmail, hotmail, yahoo. Please use proper company email.