Value added tax - what is it?
Value added tax, abbreviated VAT., is synonymous with the sales tax and the input tax. They will be after value-added principle calculated and subject to Sales Tax Act. Since value added tax is added to the selling price, it is actually a Excise tax.
Why is it raised?
The background to taxation is the interest of the state that the End user taxes Pay. Companies help them get them. For this reason, value-added tax of 19 percent or reduced by 7 percent is added to almost all services and products.
undertakings Pay for feedstocks theirs suppliers eine input tax And lead them Sales tax from sales to the tax office off. So for them it is a continuous post. Products are therefore taxed according to the value-added principle. Prior to its introduction, taxes were levied on companies' turnover. If production included several intermediate steps, the product became more expensive. In other words, in order to relieve companies, the added value of difference between purchase and sale price, taxed. This is intended to compensate for the different levels of expenses and income of a company.
How is it collected?
Die Payload of a company results from Advance sales tax return and is calculated by deducting input tax amounts from sales tax amounts. When the advance sales tax return is due depends on the amount of the sales tax burden in the previous year. Is she higher than 7500 euros, will she monthly discharged, or quarterly chez 1000 to 7500 euros. When they less than 1000 euros Is she will yearly withdrawn.
Exempt from VAT liability are small businesses. You can the Small business regulation apply to the tax office if your turnover in the current and following year is unlikely to exceed 50,000 euros. For the previous year, the Turnover limit at 22,000 euros. If the sales tax is not paid, the input tax cannot be deducted either. This is therefore more worthwhile for companies with private customers and low spending on raw or auxiliary materials from suppliers. Auch Services provided by doctors and in similar human medical professions are exempted from the obligation.
