Free §25a Margin Tax Calculator
Margin taxation under §25a of the German VAT Act (UStG) is the key taxation method for used car dealers. Instead of levying VAT on the full selling price, it is only calculated on the margin – i.e., the difference between the purchase and selling price. Our free calculator helps you compute the margin tax quickly and correctly.
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How Margin Taxation Works
Under margin taxation per §25a UStG, VAT is not levied on the entire selling price but only on the trade margin. This is a significant advantage for used car dealers, as the effective tax amount is considerably lower than under standard taxation.
Calculation formula:
- Margin = Selling price (gross) − Purchase price
- Net margin = Margin / 1.19
- VAT included = Margin − Net margin
Important: The VAT is already included in the margin. It is extracted, not added on top. The selling price to the customer does not change as a result.
When Does Margin Taxation Apply?
Margin taxation can be applied when the vehicle was purchased from a private individual, a small business, or another margin-taxed dealer – i.e., without stated input tax. Typical cases:
- Purchase from private individuals
- Purchase from small businesses under §19 UStG
- Purchase from other dealers using margin taxation
- Trade-ins from private individuals
Not applicable for vehicles purchased with stated VAT (e.g., from leasing companies with VAT disclosure or company cars with input tax deduction).
Mandatory Information on the Invoice
Special requirements apply to margin-taxed invoices:
- The note „Margin taxation under §25a UStG“ must appear on the invoice
- VAT must not be shown separately
- The total amount is stated as a gross amount
- All standard mandatory invoice details (name, address, invoice number, date, etc.) continue to apply
Margin Taxation vs. Standard Taxation: Calculation Example
A vehicle is purchased for 8,000 euros (without VAT) and sold for 10,000 euros:
- Margin taxation: Margin = 2,000 euros. VAT = 2,000 / 1.19 × 0.19 = 319.33 euros
- Standard taxation: VAT = 10,000 / 1.19 × 0.19 = 1,596.64 euros (minus input tax on purchase)
In most cases, margin taxation results in a significantly lower tax burden, especially when the margin is small relative to the vehicle price.
Automatic Margin Taxation with AutoPult
Our calculator is useful for quick calculations. In day-to-day business, however, you need a solution that works automatically. AutoPult automatically detects for each vehicle whether margin or standard taxation applies, calculates the tax correctly, and creates legally compliant invoices – without manual calculations, without risk of errors. Try it out.