Shopify gift cards in Germany: gift card, discount code and store credit for VAT

Three things Shopify calls a voucher

When German merchants say "Gutschein" (voucher) in Shopify, they often mean one of three different features. The German Shopify admin calls the gift card itself a Gutschein, in everyday use the discount code goes by the same name, and store credit also shows up in the shop as a balance. For VAT, these are three separate cases:

Shopify itself treats the gift card like money. According to Shopify Help, gift cards are "considered currency": their balance covers the entire order including taxes and shipping, and any remainder is paid with a second payment method. Shopify's sales reports do not count gift cards sold; the open balance shows up as a liability in the "Outstanding gift card balance" report. Whether tax applies, Shopify explicitly leaves to local law and refers you to a tax professional. For Germany, § 3 UStG decides.

Why Shopify gift cards are almost always multi-purpose

For vouchers issued after December 31, 2018, the German VAT Act knows two kinds (§ 27(23) UStG, German). A single-purpose voucher (Einzweck-Gutschein, § 3(14) UStG) exists only if two things are already fixed when it is issued: the place of supply and the tax due. Then the transfer of the voucher itself counts as the supply, and VAT arises at the sale. Every other voucher is a multi-purpose voucher (Mehrzweck-Gutschein, § 3(15) UStG). For those, only the actual supply is subject to VAT, and the earlier sale is not.

A Shopify gift card is valid across the whole shop. The customer can use it to pay for coffee at 7 % just as well as for a grinder at 19 %, plus shipping, and in shops with several markets also for a delivery to another EU country. So at the time of sale, neither the rate nor the country is fixed, which makes it a multi-purpose voucher in the normal case. The tax authorities name exactly this case: if a voucher can be exchanged for supplies at the reduced and at the standard rate, it is a multi-purpose voucher (section 3.17(9) sentence 4 UStAE, German). It would only be single-purpose if the entire shop sold goods at a single rate and shipped only within Germany, which applies to very few Shopify shops. The full test matrix with all four cases is in Booking vouchers in an online shop.

A purchase receipt instead of an invoice at sale

The sale of a multi-purpose voucher is not subject to VAT (§ 3(15) sentence 2 UStG, German). The customer therefore gets a receipt for the voucher amount instead of an invoice with VAT, with no tax line and no net or gross figures. What matters most is what the receipt leaves out: if it shows VAT, you owe that VAT even though no supply took place (§ 14c(2) UStG, section 14c.2(1) UStAE, both German).

In the books, the amount is recorded as a liability. The DATEV charts of accounts have a dedicated account for this, "Ausgegebene Geschenkgutscheine" (gift vouchers issued; SKR03 1796, SKR04 3786). A 50 € Shopify gift card is booked like this:

If the customer buys goods and a gift card in one order, these are two transactions: a taxable supply and a non-taxable gift card sale. The goods go on a regular invoice, the gift card on the receipt without VAT. Shipping costs belong to the goods, because the goods are what gets shipped.

At redemption the gift card counts as payment

Redemption creates the taxable sale, which is billed under the general rules (section 3.17(11) UStAE, German). The invoice lists every item at its full price and VAT rate. The gift card is a payment here, not a discount: the customer exchanges their balance for goods, just as they would otherwise pay by card. The taxable amount therefore stays at the full price, because the consideration includes everything you receive for the supply (§ 10(1) sentence 2 UStG, German).

An example: a coffee grinder costs 79.18 € gross (19 %). The customer pays 25.00 € with a Shopify gift card and the rest by credit card.

The booking at redemption has two parts. The revenue runs through the debtor account like any invoice, and the gift card portion releases the liability:

Afterwards the debtor account is settled and the gift card liability is 25.00 € lower. Which accounts your business uses exactly is up to your tax advisor.

Discount codes and store credit

Discount codes are not vouchers under the VAT Act. § 3(13) sentence 2 UStG (German) explicitly excludes instruments that only entitle to a price reduction. According to its own help pages, Shopify deducts a discount from the subtotal before tax is calculated. The discount therefore reduces the consideration, and the invoice shows the reduced price and the VAT on it. You do not need a separate register for discounts.

In Shopify, store credit is a balance in the customer account that you grant manually or choose instead of a cash refund. At checkout it is redeemed as a payment method, just like the gift card. For tax purposes, though, its origin decides: credit from a return corrects the original supply (§ 17 UStG, German), while goodwill credit not tied to a specific supply usually does not. How to separate these cases is explained in Booking Shopify store credit correctly.

What Rechnungskit handles automatically

Rechnungskit pulls orders from Shopify and recognizes gift cards by the flag Shopify attaches to every gift card line item. Rechnungskit always treats these items as multi-purpose vouchers, even if the product has not been classified in the catalog yet. That way an unclassified gift card cannot accidentally be billed with VAT.

• Sale: Instead of an invoice, a purchase receipt is created with its own number range, without VAT and without e-invoice data, carrying the note "Nicht steuerbar: Verkauf eines Mehrzweck-Gutscheins (§ 3 Abs. 15 UStG)" (not taxable: sale of a multi-purpose voucher). If goods and a gift card are in one order, an invoice and a purchase receipt are created that refer to each other and reach the customer in one email.
• Register: Every sale, redemption and refund on the gift card goes into the voucher register. The open liability is shown at the top.
• Redemption: Rechnungskit reads the redeemed portion from the payment transactions of the Shopify order. The invoice shows VAT on the full amount and lists both payment portions, for example "Credit card (54.18 €) and gift card (25.00 €)". If the portion cannot be determined unambiguously, Rechnungskit does not guess; it creates a task, which often resolves itself at the next sync with Shopify.
• DATEV: The gift card sale goes into the DATEV export as a liability, not as revenue. You set the account for the gift card liability under Settings → DATEV, ideally the way your tax advisor specifies. Rechnungskit does not yet create the contra booking for redemptions (gift card liability to debtor) itself: the redemptions per order are listed under Vouchers, and your tax advisor books them from there.

Discount codes stay discounts and reduce the affected line items. Store credit whose origin Shopify does not pass along is classified once via a task. How the whole connection works is shown on the Shopify integration page, and the voucher register in detail on the Vouchers and credit feature page. Why Shopify does not create German invoices at all without an add-on is covered in Creating Shopify invoices.