Germany

Organschaft Active Updated 2026-01-202 changes this quarter

Baseline

Organschaft — German VAT Grouping

Germany's VAT grouping mechanism (Organschaft) allows a controlling entity (Organtrager) to consolidate VAT obligations of subordinate entities (Organgesellschaften). Unlike most EU countries, the Organtrager — not the group — is the taxable person. Germany has been actively reforming Organschaft rules following CJEU case law pressure.

Key Dates

1980Modern Organschaft provisions codified

2023BMF guidance updated following CJEU Norddeutsche Gesellschaft ruling

2025Proposed legislative reform of Organschaft rules (group taxation model)

Who is in scope

Organtrager must be a legal entity or individual entrepreneur. Organgesellschaften must be legal entities (GmbH, AG) financially, economically, and organizationally integrated.

Process

Organschaft arises by operation of law when integration criteria are met -> Organtrager files consolidated VAT return -> internal supplies treated as non-taxable internal allocations.

Official Sources

BMF — Organschaft

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