Germany warns that VAT payments received with incorrect references will be subject to penalties

9 July 2019

The German tax authorities have recently written to non-EU businesses informing them that they must now declare a specific payment reference with their VAT payments going forward.

This is because of the German tax authorities facing issues in allocating VAT payments received from these types of businesses, which cause delays in updating VAT accounts and often leads to unnecessary administration work in chasing VAT debts that are already paid.

The German tax authorities warn that companies who fail to comply with this new request face penalties because the VAT payments will not immediately be allocated to their VAT account, and this will be the case regardless of whether the payment is made within the deadline.

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