Consignment Stock and Call-Off Stock
Many companies take advantage of their supplier’s consignment stock.
Hereby, the company reduces its capital commitment as invoicing only takes place when goods are withdrawn. Foreign companies must always register for VAT and there are no simplification regulations if they hold consignment stock with customers and also normal storage with different customers in Germany.
The goods withdrawn from the customers are sold at the time of withdrawal. The sale in Germany is subject to German VAT and the company invoices including German VAT. Alternatively, the customer can also issue a credit note (self-billing invoice) regarding the goods withdrawn from the consignment stock. With regard to sales to customers abroad the assessment depends on the customer status (private individual or business) and the country (EU or third country).
Incoming goods must be declared as an intra-community movement from the other EU country to Germany. The transport is to be registered as an intra-community delivery from the foreign part of the company with the foreign VAT identification number to the German VAT identification number. An intra-community purchase will then be registered in Germany. If the incoming goods result from a German supplier, the company which is registered for VAT in Germany will receive an invoice with German pre-tax which can be drawn within the framework of the preliminary VAT return. On an import from a third country the paid import sales tax can also be drawn in the preliminary VAT return.
Summary of the most important details
- Stock (e.g. consignment stock) in Germany always implies compulsory VAT registration in Germany.
- Incoming goods are registered in the preliminary VAT return (e.g. import from a third country).
- Turnover with customers in Germany are to be invoiced with German VAT.