As an association entitled to input tax deduction?

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Whether an association is entitled to input tax deduction or not depends on the activity. Sales tax is always due in the areas in which he is entrepreneurial. While this is the case with special-purpose operations, asset management and commercial business operations, the non-material area remains exempt from sales tax.

Money from the tax office - input tax deductible in principle or in part.
Money from the tax office - input tax deductible in principle or in part.

Membership fees, grants and donations as well as events without remuneration are counted as non-material. Since there is generally a sales exemption for this area, the association is not entitled to input tax deduction in these cases.

Non-profit association with entrepreneurial activity

  • The purpose-built operation is represented by non-profit events. These can be, for example, lotteries for charitable purposes, sporting events up to 35,000 euros or events of a cultural nature.
  • An economic business operation is, for example, advertising income, hospitality, sporting events with income over 35,000 euros and waste material collection. The area of ​​asset management extends to banking, the leasing of advertising rights and the leasing of real estate.
  • In economic business operations, the association subjects its sales to the general one VAT rate of 19 percent, which is equal to all non-profit Entrepreneurs means.
  • The reduced tax rate of 7 percent applies to sales in the area of ​​activity of the special-purpose enterprise and asset management. Exceptions can result from a tax exemption.
    • Non-profit status of associations

    With the recognition of non-profit status, a legal person (association, ...

Entitled to deduct input tax - input tax allocation

  • If an association is entitled to deduct input tax, input tax must be divided. If he mostly does his work through tax-free grants, his deductibility is limited. Input taxes from its input services may only be deducted if they are only directly related to taxable output services.
  • In the case of an association that carries out other non-economic activities in addition to taxable activities, the Input tax rules are applied to those expenses, insofar as they are attributable to the entrepreneurial activity are. Input tax amounts are divided according to the actual allocation.
  • A taxable economic business operation does not always lead to input tax deduction. For example, the purchase of vehicles, according to the opinion of the tax court, only serves to maintain sports operations.
  • In this respect, a distinction must be made between basic and partially deductible input tax.

If the calculation of value added tax is omitted, the association does not receive any input tax in return Tax office refunded. The general VAT exemption may have negative consequences, for example because input tax from the manufacturing costs of a sports facility cannot be claimed.

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