- The Future Financing Act extends the VAT exemption to all investment funds in Germany.
- The VAT exemption will apply to the management of all Alternative Investment Funds (AIF), including private equity, venture capital, real estate, infrastructure, and crypto funds.
- The exemption will be effective from 1 January 2024 and will no longer require comparability with Undertakings for Collective Investments in Transferable Securities (UCITS) or qualification as a venture capital fund.
- The VAT exemption only applies to the management of the fund, not to other administrative services.
- Fund managers must review their activities to determine if they qualify as fund “management” and invoice their services without VAT.
- Fund managers will no longer be entitled to deduct input VAT for VAT exempt supplies.
- Lease agreements for fund managers may need to be reviewed for information obligations, compensation obligations, or rent increases due to the VAT exemption.
Source: kmlz.de
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
