Meaning of Permanent Extension Part I
If you are an entrepreneur, you have to make a regular VAT return and make the corresponding payments. With a permanent extension , the payments are postponed accordingly, which brings a liquidity advantage.
What is a permanent extension?
According to Gradphysics, a permanent extension means that you can submit your advance VAT return one month later than actually required. In principle, it would be necessary to submit a corresponding report within ten days of the end of the reporting period, but by extending the deadline you will gain an additional month here.
The permanent extension is of course not a gift from the tax office. In return, if you have to submit monthly advance VAT returns, you have to make a special advance payment at the beginning of the year.
Special advance payment
The special advance payment applies to all those who have to submit monthly sales tax returns and at the same time take advantage of a permanent extension. In this case, at the beginning of the year you have to transfer 1/11 of the total advance VAT returns of the previous year , in principle like a deposit.
Permanent extension for the EÜR
With the EÜR , the income-surplus-calculation , the time of payment always plays an important role. The only exceptions are regularly recurring income and expenses that arise at the end of the year. This also includes advance sales tax payments. These can also be booked in the EÜR as expenses for the previous year. In order to save time and avoid chaos, an accounting and EÜR software is ideal for you !
Permanent extension of the term for the ZM
There is no longer any permanent extension of one month for the ZM ( recapitulative statement ) . Basically, the reporting period is always the calendar month. As an entrepreneur, you must submit the ZM no later than the 25th day after the end of the registration period.
Income tax permanent extension
The registration deadline for income tax can be extended by one month upon request . However, the prerequisite is that there has been a registration and payment of an advance payment of 1/11 of the sum of the advance payments. These are advance payments for the previous calendar year.
Who can apply for the permanent extension?
Any entrepreneur who is also obliged to submit their advance VAT return can apply for the permanent extension of the deadline. When obtaining a permanent extension of the term, however, there are different effects, because there are also different submission deadlines. As a “ monthly payer ”, you do not have to submit your March sales tax return by April 10th at the latest in the case of a permanent extension. have submitted, but only on May 10th. For a quarterly payer, however, the permanent extension does not automatically mean a quarterly postponement. Here, too, it is enough, for example, instead of April 10th only on May 10th
If the tax office does not reject your application in principle, this will be regarded as approval for you . However, you have to bear in mind that the permanent extension is valid indefinitely, which means for all advance VAT returns after your application.
Formal requirements for the permanent extension
| Requirement | Explanation |
| Responsibility of the tax office must be clarified | If the company is domiciled or domiciled in Germany , this is the tax office responsible for this area. If you are based abroad , you only need to contact the tax office responsible for the country in Germany for the application. |
| Correct form of the application for permanent extension | As a rule, the application for a permanent extension must be submitted electronically in accordance with the principles of the StDÜV . In order to avoid unnecessary hardship, the tax office can also approve an application on paper. |
| Deadlines must be met | In order to be valid for the current calendar year, the application must be submitted by February 10th at the latest. respectively. In the first year of its establishment, the applicant is always considered to be a monthly payer and the switch to quarterly payer is not permitted in the first year. |
Permanent extension in the UStG
The details of the permanent extension are regulated in the Value Added Tax Act. Here it is defined until when applications are to be submitted, which temporal aspects result from this and what else has to be observed in connection with the extension of the deadline.
Even special cases are defined here is about what to do if someone wants to apply for a permanent extension even though he was self-employed in the previous year is not the year. In this case, the special advance payment is calculated as one eleventh of the advance sales tax returns of the previous year published in the rest of the time, with started months counting as whole months.
In the UStG you can look up all the details and special cases relating to the permanent extension of the term.
Advantages and disadvantages of the permanent extension
The most important advantage of a permanent extension is the fact that you have more time to prepare your sales tax return and also to pay it . This is especially important for a larger company as it is not always easy to do the creation on the last day of a month or to do it right at the start of a new month.
The downside of the coin is that you have to buy the advantage of a permanent extension (to put it simply) at the tax office . The tax office would like to have a special payment for this. This is usually around 1/11 of the advance payments made in the previous year . This can be more expensive for you than, for example, a normal advance payment. That, in turn, means that you don’t necessarily create an advantage in terms of liquidity .
