Accounting regularly has to deal with many new developments, for example through reforms initiated by the legislator. At the turn of the year, new regulations have also come into force that concern the accounting of companies. For example, the following aspects are interesting:
- Due to the modernisation of corporate income tax law, partnerships can opt for corporate income tax. If you want to use this option, you must also adjust your accounting accordingly. Know-how and advice are required here.
- A significant change is coming to accounting as a result of the “Act to Strengthen Financial Market Integrity” (FISG). Balance sheet control has been fundamentally reformed by this reform. BaFin will now audit consolidated financial statements – in 2022, the focus will be on supply chain financing . Capital market-oriented companies must also note that a mandatory auditor rotation has been introduced.
- Changes came into force on 1 January 2022 for farmers and foresters who tax according to the average rate (cf. sec. 24 of the German VAT Act, through the Act on the Implementation of Union Law Requirements in VAT Law and the Annual Tax Act 2020).
Note: Companies should also note that some measures that were granted due to the Corona pandemic will no longer be used in 2022. Expertise in accounting, which measures take effect and when, is essential here. You can find more information on this in our blog post Using help and relief during the pandemic.
VAT remains a challenge
VAT also remains a challenge for accounting. New regulations came into force on July 1, 2021 as a result of the digital VAT package. However, the implementation of the digital VAT package continues to occupy many companies. The One Stop Shop (OSS) and Import One Stop Shop (IOSS) processes are still associated with many practical issues for participating companies. Unfortunately, processing is not yet a sure-fire success and the accounting department has to proceed very carefully, especially in the case of distance sales. A distinction must be made: Which goods and services can be reported via the OSS and which cannot? This qualification is not easy, even for tax experts.
Especially in the gastronomy and hotel industry, it should be noted which VAT rate is applied. For 2022, the reduced VAT rate for restaurant and catering services (cf. Third Corona Tax Assistance Act) will be applied. But beware: This does not apply to the sale of drinks.
Important values in payroll accounting
Various values that are of great relevance for accounting are also routinely adjusted. In payroll accounting, for example, due to the turn of the year, the following must be taken into account:
- The statutory minimum wage has risen to 9.82 euros per hour (2021: 9.60 euros).
- Numerous social security values have been changed and must be taken into account accordingly in payroll accounting. You can find an overview here.
- The monthly exemption limit for benefits in kind has been increased to 50 euros (previously: 44 euros).
- In the case of meals or the provision of accommodation to employees, official non-cash benefits are used to assess the non-cash benefit. When it comes to wage taxation, the accounting department must ensure that the current values for 2022 are taken into account. A breakfast is valued at 1.87 euros, a lunch or dinner at 3.57 euros. The official non-cash benefit value for accommodation is 241 euros.
- For trips abroad, special meal allowances are applied. The Federal Ministry of Finance has announced which values are to be applied in 2022 depending on the state (announcement of 27.9.2021).
Further reforms planned by traffic light coalition
The new federal government has set itself many goals. Some planned measures will also have an impact on accounting. For example, the coalition agreement speaks of a so-called super depreciation. Investments in digitization or climate protection are to be promoted in this way. The new Federal Minister of Finance Christian Lindner has also already announced that companies in the corona crisis will be relieved by new regulations on loss offsetting in 2022 and 2023.
Conclusion: The accounting department must be aware of and implement the various developments. Specialist knowledge is essential here in order to avoid incorrect valuations. Good planning enables strategic decisions to be made, for example on investment dates, and tax burdens to be reduced. For this reason, it is all the more important to check which changes need to be taken into account, especially at the turn of the year.
This article only presents some of the important changes at the turn of the year 2021/2022. Further changes are expected with the new federal government. As a specialized partner for accounting services, we will of course keep you up to date.
Image source: Pixabay Photographer: Tumisu
Author
Sylvia Meier
Guest Author
Sylvia Meier is a certified financial economist (FH) and has worked at the tax office, in consulting (Big Four firm), and for a specialized publisher. Today, as a freelance consultant, she supports companies and can demonstrate numerous publications, particularly on the topics of taxes, controlling, accounting, and finance.
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