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Germany: Additional tax relief, response to coronavirus (COVID-19)

Germany: Additional tax relief, response to coronavirus

The Federal Ministry of Finance (BMF) on 19 March 2020 released a decree on the tax measures in response to the coronavirus (COVID-19) pandemic.


Related content

The decree follows an earlier package of measures to address COVID-19 challenges. Read TaxNewsFlash

The German federal states also on 19 March 2020 published guidance addressing trade tax relief measures.

Tax relief

Among the concessions being planned are measures for a deferral of tax payments and for a reduction of advance tax payments, corporation tax, and trade tax (on presentation by taxpayers of their circumstances and implications of COVID-19). In addition, applications for deferral of taxes already due or becoming due by 31 December 2020 may be submitted, and the tax authorities are not to reject these applications because the taxpayers are not able to prove details of the amount or value of damages incurred.

Other tax relief measures include:

  • A waiver of enforcement measures or late-payment penalties is to be granted until 31 December 2020.
  • Applications for a reduction of the trade tax base, for purposes of advance payments, can be submitted until 31 December 2020.  A corresponding period for deferral applications and applications for adjustment of advance payments for income and corporation tax is also available.
  • The tax authorities may defer taxes if the collection would constitute a significant hardship. Taxpayers may submit applications until 31 December 2020 for deferral of taxes already due or becoming due by that date.
  • Tax deferrals are to be granted without interest.
  • Advance payments of income tax, corporate income tax, and trade tax may be made “on presentation of circumstances” by taxpayers that can show they are “directly and not inconsiderably affected” by COVID-19.
  • The next advance payments dates are 10 June 2020 for income tax and corporate tax, and 15 May 2020 for trade tax.
  • It may be possible to reduce advance tax payments “retroactively.”

Read a March 2020 report [PDF 126 KB] prepared by the KPMG member firm in Germany

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