EU, abroad & reverse charge · 5.4

Google, Meta, AWS: Why Do I Report VAT on Them?

Short answer

Google, Meta, AWS, and many other providers bill from another EU country, usually Ireland or Luxembourg, without German Umsatzsteuer (VAT). That is when the reverse charge mechanism applies: your GmbH reports the VAT itself and simultaneously deducts it as Vorsteuer (input tax).

Key points

Provide your USt-IdNr. (VAT ID) to these providers. Otherwise, they will charge you local VAT, which is difficult to recover.
Example: A Google Ads invoice for €1,000. Your GmbH reports €190 in VAT and deducts €190 as input tax. Net payable amount: €0.
You still have to report it; otherwise, your advance VAT return is incorrect.
Kleinunternehmer (small business owners) actually pay the €190 because they are not permitted to deduct input tax.
This also applies to foreign software subscriptions, such as from the US, if billed without VAT.

Legal basis

§ 13b Abs. 1 und 2 UStG§ 15 Abs. 1 Nr. 4 UStG

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Next video: Paying Freelancers Abroad: What Do I Need to Consider?
Related: Myth: “As a Kleinunternehmer, I don't have to do anything.”

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