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Germany Expands Tax Breaks, Allows Prepayment Reimbursement

April 23, 2020, 6:52 PM

The German government is instituting new tax measures to support businesses during the coronavirus pandemic.

  • Companies will be able to get reimbursement of tax prepayments already made for 2020 as well as certain taxes paid in 2019, according to an announcement Thursday.
  • Tax deferrals may be available upon request through Dec. 30.

  • Companies will be able to offset potential losses in 2020 against profits from the previous year. The advance payments for 2019 will be recalculated on the basis of a 15% loss carryback flat rate and any overpayment will be refunded. If the company ends up making a profit in 2020 after all, it will have to re-pay the difference.
  • Restaurants’ value-added tax on food will be lowered to 7% from July 2020 through June 2021.

  • Employers can request an extension of up to two months to file their quarterly and monthly payroll tax declarations.

Check out Bloomberg Tax’s country-by-country roadmaps covering direct and indirect tax developments.

To contact the reporter on this story: Barbara Tasch in Zurich at correspondents@bloomberglaw.com
To contact the editors responsible for this story: Meg Shreve at mshreve@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com