For the longest time, the Insurance Premium Tax was largely unknown and remained unchanged in many essential aspects. Since the Federal Central Tax Office assumed responsibility for the Insurance Premium Tax in 2010, its importance and tax revenue have been steadily increasing, currently standing at around 19 billion Euro.
A large number of legislative and administrative changes as well as relevant Federal Fiscal Court rulings in recent years have presented both insurers and policyholders with major challenges. In reality, Insurance Premium Tax has long since ceased to be a niche tax that is only relevant for insurers in the regulatory sense. Every trader who provides guarantees for their goods should at least consider whether the guarantee constitutes an insurance within the meaning of the Insurance Premium Tax Act.
Despite the partial harmonization of the Insurance Premium Tax with regard to the place of taxation on a European level, cross-border transactions are particularly complex. In addition, the close link to VAT repeatedly raises follow-up questions, for example in connection with input VAT deduction.
Thanks to our specialization in indirect taxes, we can support in all matters relating to Insurance Premium Tax, from structuring business models to the interplay with VAT.
[{"title":"Sales mark-ups for group insurance contracts: IPT, VAT or VAT exempt?","nid":"220","body":"Sales mark-ups for group insurance policies may be subject to Insurance Premium Tax (IPT), but do not have to be. In a recently published judgement, the Fiscal Court K\u00f6ln commented on the issue of IPT on sales mark-ups and opposed the tax authorities view. The IPT for sales mark-ups was rejected. Now it is up to the Federal Fiscal Court. After its last ruling from 2016 concerning sales mark-ups, the Federal Fiscal Court will now have the opportunity to provide more clarity for taxpayers.\n","field_datum":"08.05.2024\n","field_newsletter":"VAT Newsletter 22\/2024"},{"title":"Insurance Premium Tax on guarantee commitments: Tax authorities provide further guidance","nid":"377","body":"As from 1 January 2023, the German tax authorities no longer treat guarantee commitments against payment as subject to VAT but instead as subject to Insurance Premium Tax. The tax authorities developed this perspective following the Federal Fiscal Court\u2019s ruling of 14 November 2018 (XI R 16\/17), which has resulted in many uncertainties. Recently, new interpretive FAQs were published by the tax authorities. While some statements surprise, other issues remain unclear. Unfortunately, the FAQs do not provide the legal certainty many had hoped for.\n","field_datum":"20.03.2023\n","field_newsletter":"VAT Newsletter 16\/2023"},{"title":"German Federal Ministry of Finance on warranty commitments: subject to VAT or insurance tax?","nid":"492","body":"Warranty commitments are a common instrument used in sales promotion. Since they are on the borderline between VAT and insurance tax, they are also a hot topic from a tax perspective. In particular, warranty commitments in the car trade have become well-known, due to the Federal Fiscal Court having taken a number of decisions in this area in recent years. In addition, the Federal Central Tax Office, which is responsible for insurance tax, has also taken a special interest in cases concerning warranty commitments as a field of examination. Uncertainty has therefore been considerable over the\u2026","field_datum":"19.05.2021\n","field_newsletter":"VAT Newsletter 18\/2021"}]
