The 2026 Kleinunternehmerregelung Threshold
Germany's Kleinunternehmerregelung (Para.19 UStG) exempts qualifying small businesses from charging VAT. In 2026 the thresholds are: previous year turnover below 25,000 EUR and current year forecast below 100,000 EUR. Both conditions must be met simultaneously.
| Regime | Charge VAT | Reclaim Vorsteuer | Returns |
|---|---|---|---|
| Kleinunternehmer (Para.19) | No | No | Annual |
| Standard (Regelbesteuerung) | Yes 19% | Yes | Monthly/quarterly |
Standard VAT Regime Explained
Under the standard regime every eBay sale carries 19% Mehrwertsteuer. You collect it from buyers, remit it to the Finanzamt, and deduct VAT paid on business costs (Vorsteuer) in the same period. Example: You sell a product for 119 EUR. You owe the Finanzamt 19 EUR. If you paid 9.50 EUR VAT on business expenses, you remit 9.50 EUR net.
VAT-Compliant eBay Invoicing
German law (Para.14 UStG) mandates specific elements on every invoice. Missing any of them makes the invoice legally non-compliant:
- Your full name and business address
- Your Umsatzsteuer-Identifikationsnummer (USt-IdNr)
- Buyer name and address for B2B transactions
- A unique sequential invoice number
- Invoice date and supply date
- Item description, quantity, unit price
- Net amount, VAT rate 19%, VAT amount, and gross total
OSS for Cross-Border EU Sales
If your cross-border B2C sales to other EU countries exceed 10,000 EUR per year, you must use the OSS (One Stop Shop) scheme. OSS lets you declare all EU cross-border VAT centrally through the Bundeszentralamt fur Steuern in a single quarterly return instead of registering in every EU country separately.
Filing Your Umsatzsteuervoranmeldung
Advance VAT returns are filed via ELSTER. Frequency depends on previous year VAT liability: under 1,000 EUR annual only; 1,000-7,500 EUR quarterly; over 7,500 EUR monthly. New businesses default to monthly for the first two years.
Register at elster.de
Free government portal. Activate with your Steuernummer. Allow 1-2 weeks.
Prepare your return in Lexware
Lexware calculates your VAT position automatically and exports ELSTER-ready data.
Submit before the 10th
Returns are due by the 10th of the month following the reporting period.
Pay any VAT due
Bank transfer to your Finanzamt using the payment reference provided.
5 Costly VAT Mistakes eBay Sellers Make
- Not registering when exceeding the threshold - Finanzamt can retroactively assess VAT plus interest on every sale
- Pricing without VAT in mind - your margin takes the full 19% hit if unaccounted for
- Missing the mid-year regime switch - many sellers discover they breached 100,000 EUR months late
- Non-compliant invoices - missing USt-IdNr or wrong VAT rates create audit exposure
- Ignoring OSS - selling EU-wide without proper VAT handling creates liabilities across multiple countries
Lexware and SKR04 Setup
Lexware Office configured with SKR04 is the industry standard for German eBay sellers. It handles VAT calculation, invoice generation, Umsatzsteuervoranmeldung preparation, and annual EUR statements. ScalewithFahad account setup service includes full Lexware configuration as part of onboarding.
Need Help with German VAT Setup?
Full German VAT setup including USt-ID application, Lexware configuration, and first Umsatzsteuervoranmeldung. Part of eBay Account Setup at 100 EUR plus MwSt.
FAQ
Full 2026 legal guide
Compliance checklist
Start VAT-Compliant, Scale Confidently
German VAT is not optional and the Finanzamt enforces it retroactively. Get registered correctly from day one, use Lexware Office, file on time via ELSTER. Need hands-on support? ScalewithFahad handles the entire setup.