For entrepreneurs who calculate their profit using a cash basis accounting system, the VAT paid to the tax office must be recognized as an operating expense. The inflow or outflow may only be recognized differently from the actual time of payment if it concerns income or expenses that flow in or out within a short period (= 10 days) before or after the end of the year to which they belong economically. This means that payments can only be made between 22.12. and 10.1. of the following year.
In order for payments made in a different year to be deducted, they must be made within the 10-day period. due and performed must have been made. Both requirements must be met at the same time. With Advance VAT payments and refunds are generally regularly recurring expenses or income, so that the 10-day rule also applies here, i.e. also for the advance VAT return for the fourth quarter, which must be submitted by January 10 of the following year. This therefore only applies to advance returns for which no permanent extension has been granted.
Practical example (extension of the submission deadline/due date):
An entrepreneur (revenue surplus accountant) claims his advance VAT payment for December 2025, which he makes on time in 2026, as a business expense for 2025. The advance VAT payment for December is tax-deductible in 2025, even if the deadline is postponed to 12.01.2026 because 10.1.2026 falls on a Saturday (see BFH ruling of 27.6.2018, X R 44/16). Nevertheless, the payment must have been made by 10.01.2026. The VAT advance payment must also be due within the 10-day period, so this requirement is met here. This is because, according to the BFH, the determination of the due date is based solely on the statutory deadline, but not on a possible extension of the deadline in accordance with Section 108 (3) AO.
With a Permanent extension the submission deadline, e.g. for the month of December 2025, is outside the 10-day period. Entrepreneurs who submit their advance VAT returns on a monthly basis must submit the advance return for the month of December by 10.1.2026; in the case of a permanent extension, the advance return for the month of November must be submitted by 10.1.2026.
Special feature of direct debit authorization issued to the tax office
If the entrepreneur issues the tax office with a direct debit authorization, he has no influence on when the tax office debits the „VAT payable“ from his account. This is also not important. Rather, the decisive factor is that the tax office is authorized to debit the account by 10 January. In the case of an authorization for direct debit, it is therefore assumed that the VAT has been paid by the due date. The prerequisite is that the advance VAT return was submitted on time and that the account in question has sufficient funds at the due date. It does not matter if the account was not actually used by the tax office until later or if it is possible to revoke the direct debit after it has been debited.