In the case of input tax deduction from a supply before the Transition of the entrepreneur to standard taxation or small business regulation please note the following:
Transition from tax exemption to general taxation
If an entrepreneur who switches from the tax exemption under the small business regulation to general taxation has already been taxed before the transition
- supplies which he only intends to use after the transfer to carry out transactions which then entitle him to deduct input tax,
- input tax deduction is nevertheless excluded for periods prior to the transition to standard taxation in accordance with Section 15 (2) sentence 1 no. 1 or 3 UStG.
This also applies if the transfer - e.g. due to exceeding the limits in Section 19 (1) UStG - is already probable but has not yet actually taken place. This also applies to input VAT deduction from advance and advance payment invoices. The actual transition to standard taxation then represents a change in circumstances, which is why an input tax adjustment in favor of the entrepreneur is only possible for the corresponding input tax amounts under the conditions of Section 15a UStG and in compliance with the de minimis limits of Section 44 UStDV.
Transition from general taxation to tax exemption
The transition from regular to small business taxation represents a change in circumstances, which is why a previously made input tax deduction after the transition must be corrected at the expense of the entrepreneur under the conditions of Section 15a UStG and in compliance with the de minimis limits of Section 44 UStDV. The input tax deduction is not corrected if the input tax attributable to the acquisition or production costs of an asset does not exceed € 1,000.
Transitional regulation: The principles of the BMF letter are to be applied to all open cases. However, there is no objection if a business refers to the version of section 15.3 para. 2 UStAE valid until 10.11.2025 in a VAT return submitted by 10.11.2025. In these cases, input VAT must be taken into account accordingly in a VAT return for a later calendar year.