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On the first working day of the new year, VWG wishes everyone all the very best for 2021, both professionally and personally. We would also like to draw your attention to a number of tax matters that need to be dealt with at the start of the year.<\/p>\n
The VAT return for the final period of 2020 must be submitted in January 2021. A number of special considerations must be taken into account in that return.<\/p>\n
For example, the VAT payable on the private use of company cars must be paid. In the vast majority of cases, this amounts to 2.7% (or 1.5%) of the car\u2019s list price. In addition to the car, VAT must also be paid on the private use of other goods and services.<\/p>\n
It must also be determined whether the extent to which VAT has been deducted is correct, based on the actual use of goods and services purchased in 2020. In this context, immovable property is monitored for 10 years and movable property for 5 years (revision scheme). Due to the coronavirus crisis, the use of such goods and services for VAT-taxable transactions may differ significantly.<\/p>\n
With regard to owned or rented property, it may be necessary to by 28 January 2021 at the latest<\/strong> a declaration must be issued if it has not been used for VAT-taxable supplies amounting to 90% (sometimes 70%) or more.<\/p>\n In January or February 2021, the 2020 work-related expenses scheme must be settled with the Tax and Customs Administration. It must be determined whether the discretionary allowance has been exceeded. If this is the case, the 80% final levy must be paid on the amount by which the allowance has been exceeded.<\/p>\n In 2020, the tax-free allowance amounts to no less than 3% on the first \u20ac400,000 of the wage bill, and 1.2% on the portion of the wage bill above \u20ac400,000. PLEASE NOTE: in 2021, the allowance on the first \u20ac400,000 of the wage bill will return to the \u201cstandard\u201d rate of 1.7%. Above that threshold, the allowance has been reduced slightly to 1.18%.<\/p>\n Groups of companies may choose whether to apply the group scheme. This choice may be made anew each year. The tax-free allowance for all group entities is then pooled together. PLEASE NOTE: due to the one-off increase in the allowance on the first \u20ac400,000 of the wage bill, the group scheme is not always advantageous in 2020.<\/p>\nSettlement under the work-related expenses scheme<\/h4>\n