Germany has a gross domestic product (GDP) of more than\u00a0\u20ac2.7 trillion that makes it the largest economy in Europe and the fourth largest in the world. It’s also\u00a0is the UK\u2019s largest export market in Europe and second largest globally after the US. The UK\u2019s market share of German imports is around 4.7%.<\/p>\n
The strengths of the German market include:<\/p>\n
- \n
- strong industrial base<\/li>\n
- hosts 65% of the world\u2019s international trade fairs<\/li>\n<\/ul>\n
And the benefits of exporting to Germany are:<\/p>\n
- \n
- one hour from the UK by air<\/li>\n
- easy access to eastern Europe<\/li>\n
- English widely spoken and accepted as a business language<\/li>\n
- strong domestic consumer market due to population of 81 million and resilient economy<\/li>\n<\/ul>\n
As far as challenges go, if you’ve a successful product or service in the UK, there\u2019s every chance it’ll\u00a0be a success in Germany. The German market is extremely competitive though and some companies have a \u2018buy local\u2019 attitude.<\/p>\n
So it’s important British companies not only\u00a0offer something unique in order to stand out, they also need to be patient and persistent.<\/p>\n
If you\u2019re doing business in Germany, you\u2019ll need a reliable and cost-effective conference call\u00a0<\/a>provider to help keep in touch when travelling isn\u2019t an option. Here\u2019s\u00a0How to set up a conference call between the UK and Germany<\/a>.<\/em><\/div>\n\nAnd remember, you can now screen share and video conference, using Crankwheel<\/a>.<\/p>\n<\/div>\n
How does tax work in Germany?<\/h2>\n
A double taxation agreement exists between the UK and Germany, so tax isn\u2019t paid twice \u2013 once in each country \u2013 on exported goods and services.<\/p>\n
VAT<\/abbr>\u00a0is charged at a rate of 19%. 7% on convenience goods and services needed on a day-to-day basis such as food, newspapers or public transport. Some services including banking, healthcare and non-profit work are exempt from\u00a0VAT<\/abbr>.<\/p>\n
If you’re exporting to Germany from the UK, your goods will be zero-rated for\u00a0VAT<\/abbr>\u00a0purposes if your customer provides their\u00a0VAT<\/abbr>\u00a0registration number (\u2018Umsatzsteuer-Identifikationsnummer\u2019 or \u2018UST-IdNr\u2019) and you have proof of export.<\/p>\n
You\u2019ll need to get the VAT<\/abbr>\u00a0registration number of your German customer for your VAT r<\/abbr>eturn and paperwork to prove the goods have been sent within certain time limits (usually 3 months), and then:<\/p>\n
- \n
- record all the goods sold to Germany on your\u00a0VAT<\/abbr>\u00a0Return<\/a><\/li>\n
- fill in an\u00a0EC Sales List<\/a><\/li>\n
- fill in an\u00a0Intrastat<\/a>\u00a0declaration if your total dispatches are worth more than \u00a3250,000<\/li>\n<\/ul>\n
Germany does not have a nationwide tax rate for companies. Corporate tax rates average about 30% depending on the local municipality. Go to\u00a0Germany Trade and Invest<\/a>\u00a0to find out more about Corporation tax.<\/p>\n
How will I be affected by customs in Germany?<\/h2>\n
The internal EU single market allows for the free movement of goods and services without any import duties being applied, and testing is mandatory for some imported goods, especially technical and electrical equipment.<\/p>\n
- fill in an\u00a0EC Sales List<\/a><\/li>\n
- record all the goods sold to Germany on your\u00a0VAT<\/abbr>\u00a0Return<\/a><\/li>\n
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