Sales and income tax in non-profit hospitals

Income taxes

• Legal basis of income tax exemption: KStG, EstG, AO, requirements for articles of association and actual activity.
• Delimitation of tax-privileged purposes: charitable purposes, non-profit purposes, ecclesiastical purposes.
• The 4 spheres of the non-profit organization: Differentiation between the ideal sphere, asset management, special-purpose operations and taxable commercial operations.
• Special-purpose operations for hospitals: Section 65 AO Special-purpose operations in general, Section 66 AO Welfare care, Section 67 AO Hospitals.
• Taxable business operations in hospitals: § 64 AO, examples of typical taxable activities, delimitation issues.
• Issuing donation receipts: Differentiation between donation and sponsoring.
• Non-profit reform 2020, in particular effects and possibilities for cooperations.

Value added tax

• The exchange of services for VAT purposes: differentiation between supplies / other services, place of supply.
• Relevant VAT exemptions for hospitals: delimitation of tax-exempt / taxable activities.
• Input tax deduction and input tax adjustment: Differentiation between idealistic area, asset management, special-purpose operation and taxable economic business operation.
• Requirements for the correctness of invoices: content requirements, current information on electronic invoices.
• Reverse charge: risks associated with the recipient being liable for tax.
• Special VAT features for tax-privileged organizations: Provision of personnel and other forms of cooperation.