Restructuring decree – no legitimate expectations in so-called old cases after all?
By resolution dated 28 November 2016, file number GrS 1/15, the Grand Senate of the Federal Fiscal Court (BFH) declared the so-called restructuring decree illegal. The legislator recognized the needs for the restructuring of companies and created a new legal basis for the tax exemption of restructuring profits (see our newsletter article in 2017 | […]
In general, shareholder loans are not taken into account as subsequent acquisition costs within the scope of Section 17 EStG anymore
By its judgment of 11 July 2017 – IX R 36/15, the German Federal Fiscal Court (BFH) has fundamentally changed its jurisdiction regarding the clasification of equity-replacing financial aids of shareholders to their company as acquisition costs within the scope of section 17 of the German Income Tax Act (EStG). Financial aids are, for example, […]
Karlsruhe deals a severe blow: the lapse of loss carry forward upon acquisition of detrimental participation according to § 8c sec. 1 sentence 1 KStG is unconstitutional
By decision of 29 March 2017 the Federal Constitutional Court (Bundesverfassungsgericht) declared the partial lapse of loss deduction in the case of a detrimental exchange of shareholders in the amount of over 25% to 50% to be unconstitutional in all law versions between 2008 and 2015. The legislator is obliged to revise the law with […]
Reintroduction of tax exemption on restructuring profits
By passing the law dated 27 June 2017, the tax exemption on restructuring profits was stipulated once again. However, the readjustments will only become effective in case the EU commission signs off on the new legal readjustment with respect to state aid law. The new law is supposed to apply retrospectively to all debt reliefs/restructuring […]
New legal provision of § 8d KStG (Corporate Tax Act) – tax loss carry-forwards of corporations can be saved in some cases when there is an exchange of shareholders
There are good news for corporations with tax loss carry-forwards in the case of an exchange of shareholders: after the introduction of § 8d KStG, tax loss carry-forwards already existing can still be used provided that the current business operations of the corporation are continued and the loss carry-forwards are used in these business operations […]
Prevention of a double deduction of operational expenses (§ 4i EStG (German Income Tax Act) – new)
The prevention of the use of international tax arrangements, where in particular divergent tax system are being “played off” against each other (OECD’s BEPS project/G-20), is in the centre of attention of the current and future tax legislation: A shareholder’s personal expenses can no longer be deducted as special business expenses, as long as these […]