Tax year in review – challenges without end

Steuerlicher Jahresrückblick 2021

It’s not yet December, but it’s worth taking a look back at 2021 from a tax perspective, even in November. What a year this has been! The Corona pandemic has turned the world upside down, although one of the biggest tax reforms in the European Union was already planned anyway. We do not dare to answer whether all the tax adjustments have served their purpose. But let’s take a look at all the events.

Corona – Economic Stimulus Package 2020

In order to strengthen demand and secure employment, the so-called economic stimulus package applied in Germany for the period between July 1, 2020 and December 31, 2020. Instead of 19 percent, the VAT rate was reduced to 16 percent. In addition, the reduced tax rate was lowered from 7 percent to 5 percent.

A fiscal year look back at 2020? What was naturally seen as a relief was probably more bureaucratic effort than clear benefit for most entrepreneurs afterwards. Our own experience has shown that online retailers had a much more manageable effort here than stationary retailers, for example. Goods did not have to be relabeled and prices, since they are usually stated in gross, could remain as they are. Only the tax rate included changed.

Even this small effort could be implemented within seconds with the help of easybill, as the invoicing software could activate the tax reduction at the push of a button. Uncomplicated and automated – that’s how easybill customers know their software.

On 1.01.2021, the tax rates in Germany were raised again to their original value. Fortunately, almost nothing had to be changed here, since easybill also intervened here via the automatic function. But as if the one or other manual adjustment to 1.01.2021 had not already been a challenge for some, the BREXIT was then also added.

BREXIT as of 1.01.2021

That the decision to BREXIT is associated with far-reaching consequences was certainly already clear to everyone during the negotiation phases. However, the extent to which it will actually affect every German entrepreneur or every European entrepreneur only became clear in January of this year.

Of course, it must be mentioned that at the same time the innovation of the marketplace liability is also a decisive factor. Nevertheless, the surprise was often not missing that one as an entrepreneur is suddenly no longer responsible for invoicing and invoices are “missing”. In one or the other marketplace, there is certainly still some need for optimization for transparency, clarification and also the provision of an invoice, but we are optimistic about the future here.

So the UK is now a third country for tax purposes. The whole of the UK? That would be too simple. Northern Ireland is not involved and also regulations that differentiate between end customers (B2C) and business customers (B2B) make the whole process a permanent challenge. Not to be forgotten is also the amount of the order value. From 135 GBP upwards, any invoicing has to be done by the entrepreneur.

How good that there are software solutions like easybill that support you in your everyday business and make life easier! Our tax advisor partners and our tax advisor network are also available to assist you here at any time.

Last but not least – OSS

Have you ever tried – from an entrepreneurial point of view, of course – to talk about the past year without mentioning the word “OSS” in the course of “Tax Year in Review 2021”? Quasi an impossibility. After all the tax hurdles, the One-Stop-Shop was now added on 1.07.2021. What is intended as a relief, however, is also first a challenge in the first step. Like everything new, many parties involved must of course first get used to this change.

Via our blog and also in our newsletters, we at easybill informed all customers about the new requirements at an early stage. Our network of tax consultants is also trained in the topic of OSS. If your tax advisor unfortunately does not yet give you the impression that he is up-to-date, look around for an alternative if necessary. Do not underestimate the tax implications of not being registered for the OSS in time.

What is the OSS?

For those of you who have not been affected to date, we’d like to briefly recap:

Previous delivery thresholds in the EU have been abolished:

  • instead, there is now a cumulative delivery threshold for all EU countries of €10,000 net value of goods
  • you register for the One-Stop-Shop via the central registration office in your company’s country of domicile. Registration is possible only on the quarter (1.07., 1.10., 1.01., 1.04.)
  • if you use a storage abroad and a shipment from this country, you still have to register locally there (example: Amazon CEE and PAN EU program)
  • for third countries that ship goods to the EU, the so-called IOSS applies

If you still have questions regarding the settings around the OSS in the account, our easybill support team will be happy to help you at any time. For tax-related questions, please contact your tax advisor.

Conclusion tax year review 2021

Hardly any year has been as challenging as 2021. Would we all like to relax a little in 2022? Definitely. Can easybill users be optimistic about this planning? Most definitely. We keep an eye on fiscal changes for you at all times and assure you that easybill will always find the most convenient way for you. Nevertheless, we hope that the coming year will also be without economic stimulus packages and innovations. It remains exciting.