The temporary reduction of the sales tax rates from 19 to 16% and from 7 to 5% decided by the Federal Government poses great challenges for the financial accounting of companies but also for all providers of accounting and billing software. Especially because of the very short lead time of one month, solutions have to be found which on the one hand represent a correct representation of the facts, but on the other hand are as uncomplicated as possible to handle.
How does the billwerk system deal with this tax change?
billwerk enables you to configure sales tax rates for Germany that are to be applied from a key date. The temporarily valid tax rates and the key dates for the changes (01.07.2020 and 01.01.2021) are already preset.
For continuous services, billwerk determines the VAT rate based on the end of the service period. Optionally, continuous services can be automatically divided into partial services taking into account the dates of the tax rate changes.
The application of the configuration is only activated after the final provision of a corresponding software update on the billwerk systems.
Together with the activation, it is possible to correct invoices and thus subsequently have the applicable VAT rate applied. This is intended for invoices that were already created before 01.07.2020 and contain items whose performance period ends or goes beyond the time of the tax change.
For data transfer to financial accounting, you can configure a separate financial accounting revenue account in your billwerk client for each combination of tax country, tax rate, and currency, as well as an optional corresponding financial accounting VAT account.
What changes on the DATEV side?
According to the information currently available to us, DATEV will automatically apply the change in VAT rates for so-called automatic accounts* in the background. The DATEV software will then decide which VAT rate to apply based on the performance period or document date. However, the change will only be available when the DATEV software is updated (according to DATEV with a special patchday on 30.06. 18:30 hrs).
This solution becomes problematic if you have already created invoices with invoice items affected by the tax reduction before July 1 and want to post these after the DATEV update. The VAT rate (19%) shown on the invoice would not be correctly transferred to DATEV in this case (here 16% by the automatic system). Even an invoice correction does not solve this problem because the originally posted tax rate is not the correct one. In addition, the current draft of the accompanying BMF letter includes a transitional period for invoices issued to companies as recipients of services until 01.08.20. After that date, the higher VAT rate of 19% will be tolerated for these invoices and the service recipient will be granted the right to deduct input tax "for reasons of simplification". (see also https://www.bundesfinanzministerium.de/Content/DE/Downloads/BMF_Schreiben/Steuerarten/Umsatzsteuer/2020-06-23-befristete-Senkung-umsatzsteuer-juli-2020-erste-aktualisierung.pdf?__blob=publicationFile&v=2, section 3.12)
If the scenarios described in this article apply to you, please contact your tax consultant or your DATEV partner. If necessary, you can control the automatic in DATEV via the account settings (in DATEV). You should also consider not using the account automation and configuring the net revenue accounts and the VAT accounts separately in billwerk ("account type": net).
billwerk offers you options for reacting to this situation in the account assignment settings (Settings > Accounting > Accounts) as well as in the export settings (Settings > Accounting > Export Settings). In the account settings, revenue and tax accounts can be explicitly defined and in the export settings, for example, the end of the performance period of an invoice item can be configured as an additional field (can be used together with "Output per invoice item" in the account settings).
* - In the case of DATEV automatic accounts, the DATEV software automatically generates a log entry when an amount is to be posted to it. This split posting divides the transferred amount into the net amount to be posted to the account and the tax amount to be posted to a linked tax account. Both postings are then executed automatically.