Germany VAT Guide for 2026: Rates, Registration & Filing
Germany's standard VAT (Mehrwertsteuer) is 19%, with a reduced 7% rate. Learn registration requirements, OSS for cross-border sales, and filing with the Finanzamt.
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Key Takeaways
Germany's standard VAT (Umsatzsteuer) rate is 19%, with a reduced 7% rate on food, books, and public transport — and from January 1, 2026, permanently on restaurant and catering food (though drinks stay at 19%). A non-established business must register as soon as it makes taxable supplies, with no threshold; for EU-wide B2C distance sales, VAT is due once sales exceed the EU-wide EUR 10,000 threshold. SaaS and digital products are taxable at 19%, typically accounted for via OSS by non-resident sellers; financial, medical, and education services are exempt.
Taxability Snapshot
SaaS
Taxable
Digital Goods
Taxable
Sales Tax Rates
Germany's standard VAT rate (Umsatzsteuer) is 19%, with a reduced 7% rate on food, books, and public transport. From January 1, 2026, the 7% reduced rate also applies permanently to restaurant and catering food, though drinks stay at 19%. VAT is administered by the local Finanzamt and the Federal Central Tax Office.
Rate | Applies to |
|---|---|
Standard 19% | Most goods and services |
Reduced 7% | Food, books, transport, restaurant food (from 2026) |
Zero 0% | Intra-EU and export supplies |
Germany is phasing in mandatory B2B e-invoicing, with receipt capability required from 2025 and issuance obligations rolling out through 2027 and 2028.
Registration & nexus threshold
Germany uses VAT registration rules rather than US-style economic nexus. A non-established business must register as soon as it makes taxable supplies in Germany, with no threshold [2]. For cross-border B2C sales within the EU, VAT is due in the customer's country once total EU distance sales exceed the EU-wide EUR 10,000 threshold, reportable through the One Stop Shop [3]. A small domestic business may use the Kleinunternehmer exemption below its national turnover limit [4]. Registration steps are in the How to Register section.
Filing frequency & deadlines
Filing frequency depends on VAT due: monthly if prior-year VAT exceeds €9,000, quarterly if between €2,000 and €9,000, and annually if €2,000 or less (with Finanzamt approval). Returns and payment are due by the 10th of the following month, with a permanent filing extension (Dauerfristverlängerung) available on application.
Exemptions
Exports and intra-EU B2B supplies are zero-rated, and financial, medical, and education services are exempt. SaaS and digital products are taxable at 19%; for B2C sales to German consumers, non-resident sellers charge German VAT, typically via OSS.
Penalties
Late filing can draw a surcharge of up to 10% of the VAT due (capped at €25,000), and late payment accrues interest of around 1% per month. The Finanzamt may also impose additional penalties for persistent non-compliance.
Sources
[1] European Commission — VAT rates (Germany 19% standard, 7% reduced)
[3] Federal Central Tax Office (BZSt) — One Stop Shop (EU-wide EUR 10,000 threshold)
[4] German Federal Ministry of Finance — Kleinunternehmer small-business rule
[5] German Federal Ministry of Finance — Fiscal Code (objection and fiscal court appeal)
[6] German Federal Ministry of Finance — Mandatory e-invoicing rollout
Verified July 2026 against German Federal Ministry of Finance, Federal Central Tax Office, and European Commission guidance.
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