European Commission proceeds against Germany’s personal signature requirement for non-EU resident businesses on input VAT refund applications

European Commission refers Germany to the Court of Justice of the European Union on the personal signature requirement for non-EU resident businesses on input VAT refund applications.

Under Germany’s VAT law, an entrepreneur resident in a non-EU member state must personally sign an application for a refund of input VAT. Although the European Commission asked Germany to amend this rule in 2012, Germany has not done so. In fact, the rule was affirmed in a 2013 decision issued by the Federal Tax Court; the court held that the statutory representative of a non-EU resident applicant must personally sign a claim for an input VAT refund made under the special VAT refund claim procedure for non-EU residents (13th Directive reclaim).

According to the Commission, however, the personal signature requirement is in contravention of the EU law principles of effectiveness, proportionality and equivalence. There is no legal provision in the EU that requires a personal signature on VAT forms. Therefore, the European Commission has now decided to take Germany to the Court of Justice of the European Union.

Companies resident in a non-EU member state that have received a notice of rejection of an input VAT refund should file an appeal and request a suspension of the proceedings, making reference to the referral of the European Commission.