Retroactive Application of Tax Laws
Judgment of the Hessian Finance Court on the Taxation of a Severance Payment Tax laws can have a retroactive effect following a decision by the Hessian Finance Court on November 21, 2023 (Case No.: 10 K 1421/21). Accordingly, a severance payment can be taxed in Germany since 2017, even if the taxpayer has since moved […]
Cologne tax court rules special funds can receive preferential tax treatment
Special investment funds are eligible for preferential tax treatment, according to a recent ruling of the Finanzgericht (FG) [Fiscal Court of] Cologne from August 24, 2022 (case ref.: 12 K 1540/19). German tax law allows special funds established under Luxembourg law to benefit from certain tax privileges. MTR Legal Rechtsanwälte, a commercial law firm whose […]
Cologne Tax Court: Special Funds Can Benefit from Tax Privileges
The tax privilege for special investment funds is permissible according to a judgment made public by the Fiscal Court of Cologne on August 24, 2022 (Case No.: 12 K 1540/19). Tax law allows for a tax privilege for special funds established under Luxembourg law. According to the Investment Tax Act in the version valid until […]
Voluntary disclosure – Hesse purchases Pandora Papers
The German state of Hesse has begun delving into the so-called “Pandora Papers” with a view to uncovering evidence of tax-related offenses. Anyone considering submitting a voluntary declaration for tax evasion ought to take action now. The name “Pandora Papers” refers to the millions of financial documents that were leaked in 2021 containing information about […]
Hesse Begins Evaluating the Pandora Papers – Voluntary Disclosure Still Possible
Hesse begins evaluating the so-called Pandora Papers, which can provide clues about tax offenses. Anyone who still wishes to make a voluntary disclosure for tax evasion should act now. The Pandora Papers made headlines in 2021 as a massive tax data leak concerning tax havens and especially offshore investments. The more than 3.8 terabytes of […]
Global minimum tax for internationally operating companies
With the introduction of a global minimum tax, a significant change in international tax law is imminent, which internationally operating companies must prepare for. International tax law is on the verge of a profound reform, primarily affecting internationally operating corporations. The introduction of a global minimum tax rate of 15 percent is intended to prevent […]
BFH says no tax deduction for final losses of foreign branches
In a judgment from February 22, 2023, Germany’s highest tax court – the Bundesfinanzhof (BFH) – ruled that German companies may not be able to offset losses incurred by a branch office in another EU country against profits generated in Germany as a means of reducing their tax burden. Under international tax law, domestic companies […]
BFH on the Tax Recognition of Non-Congruent Profit Distributions
The BFH ruled on 28.09.2022 that under certain conditions an incongruent profit distribution can be recognized for tax purposes even without a corresponding provision in the articles of association. Profit distributions in practice do not always occur based on the ownership ratios. Tax law allows for the recognition of such incongruent profit distributions. According to […]
FG Münster: No Taxation through Passive Migration
Changes to a double taxation agreement do not lead to the realization of the disentanglement facts and taxation, according to a ruling by the Finance Court of Münster on August 10, 2022. Double Taxation Agreements (DTAs) play an essential role in international tax law. The Finance Court of Münster has now made it clear in […]
Joint Audits – Cross-border Tax External Audit
Tax audits can also be conducted cross-border. The aim of these so-called Joint Audits is to avoid double taxation, but also to avoid double non-taxation. Companies regularly have cross-border business relationships. With the help of so-called Joint Audits, tax administrations can also engage in cross-border activities during tax audits. Although Germany has concluded numerous double […]
