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When are gratuitous transfers of value taxable?

Taxation takes place at the time of consumption, i.e. free gifts of value are subject to the tax rates of 19% and 7% in the period from 1 January to 30 June 2020 and to the tax rates of 16% and 5% in the period from 1 July to 31 December 2020. This also applies to electricity from photovoltaic systems used for non-business purposes and heat from combined heat and power plants used for non-business purposes.

In the case of the use of vehicles for non-business purposes and in the case of vehicles provided to employees against payment, the so-called 1% rule can be applied to determine the tax base for reasons of simplification (para. 15.23, para. 5, no. 1, letter a and para. 11, no. 1 UStAE). The initial value is the gross list price at the time of first registration (§ 6, para. 1, no. 4, sentence 2 EStG). In the case of initial registration in the period from 01.07. to 31.12.2020, the gross list price applicable in this period is to be used. This remains the initial value even after 31.12.2020. Use in the period from 01.07. to 31.12.2020 is subject to the reduced tax rates.



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