Neither the Arbitration Agreement nor the resulting mutual agreement procedures provide an independent legal basis for a reduction of corporate income. According to the Supreme Tax Court in its recent decision, an agreed reduction in profits must be feasible to implement under national tax law. The specific subject matter in dispute was the non-deductibility of 5% of the tax-exempt income pursuant to Section 8b(5) of the Corporate Income Tax Act.
The Council today agreed further measures to improve value-added tax (VAT) collection on e-commerce sales into the EU. The new rules make the framework for collecting this VAT fully aligned with recent reforms in the EU’s customs system, in turn leading to better tax compliance and collection.
In a recently published decision, the Supreme Tax Court held that a full-time shareholder-managing director who was employed by a GmbH at the time of his death is to be counted as an employee when determining the preferential tax treatment under Section 13a(1) of the Inheritance and Gift Tax Act. Part-time employees must also be counted as employees on a per capita basis.
Litigation costs are deductible as extraordinary personal expenses if they are unavoidable for the taxpayer. According to a recent decision of the Supreme Tax Court, this is generally not the case for litigation costs associated with the acceptance of an inheritance or a gift.
The Supreme Tax Court submitted four questions to the European Court of Justice (ECJ) for a preliminary ruling regarding the right to carry forward tax credits under EU law. In his Opinion, Advocate General Rimvydas Norkus concludes that Directive 2011/96/EU (the Parent-Subsidiary Directive) precludes the German rule under which foreign taxes on dividends paid by a subsidiary - in case of loss carryforwards of the parent company - are final and permanently excluded from being credited.
The Supreme Tax Court has referred several questions to the European Court of Justice (ECJ) for a preliminary ruling pertaining to the withholding tax on dividends paid to companies in third countries (in this case, a Japanese corporation). Advocate General Laulhé Shaelou has now presented her Opinion.
In a recently published decision, the Supreme Tax Court addressed the conditions under which the expiration of the assessment period (statute of limitations) is suspended due to inquiries by the tax investigation department.
The case before the Supreme Tax Court involved the question of whether and in what circumstances subsequent production costs for land were incurred. In its recent judgement, the Supreme Tax Court held that expenses to remove mining damage from a property may be treated as immediately deductible income-related expenses.
When a foundation inherits shares from a contributor and sells them within the seven-year lock-up period, the resulting contribution gain I (“Einbringungsgewinn I”) is attributed retrospectively to the contributor. The foundation must pay the tax as the contributor’s universal successor. Section 22(6) of the Reorganisations Taxes Act 2006 (RTA) does not govern the personal attribution of that gain: its scope must be narrowed to reflect the provision’s purpose ( so-called teleological reduction)
In a recently published judgment, the Supreme Tax Court decided that a pilot’s primary place of work also includes an aircraft parked at its home airport. Until the aircraft leaves its parking position it is considered part of the airport grounds. Refueling and safety checks in the cockpit are therefore activities performed at the primary place of work.
In a recent judgment again dealing with cum-ex schemes, the Hamburg Tax Court dismissed the appeal against the assessment of interest on tax evasion in a so-called “cum-ex case” as unfounded.
Section 32a(1) Sentence 1 of the Corporation Tax Act, as a provision amending the rules on hidden profit distributions, also permits the corresponding recognition of hidden contributions indirectly connected with the hidden profit distribution as subsequent acquisition costs for a participation in another corporation, the Supreme Tax Court said in a recent decision.
In response to a request for a preliminary ruling from Latvia, the European Court of Justice (ECJ) must examine how the term “double taxation” is to be interpreted within the meaning of the EU Dispute Resolution Directive. The mere fact that the same income could, in the abstract, fall within two (or more) tax jurisdictions is not, in any event, sufficient to establish double taxation within the meaning of the Dispute Resolution Directive, according to the Advocate General in her Opinion.
The request for a preliminary ruling from the Supreme Tax Court involves the repair and maintenance work of a sailing boat solely imported for this reason from Switzerland. In its decision, the General Court held that transporting the boat to Germany is not an importation of goods subject to VAT and does not constitute use of those goods under Article 124(1)(k) Customs Code.
The Federal Ministry of Finance (MoF) commented on the application of the Supreme Tax Court decision dated 10 October 2025 (case: IX R 4/24). In its circular, the MoF points out that - contrary to this decision by the Supreme Tax Court - previous case law continues to apply to contractually agreed waivers of the right of usufruct until the end of the day on which the decision was published in the Federal Tax Gazette.
In his Opinion, Advocate General Rantos proposes that the temporary solidarity contribution on surplus profits of energy sector companies, introduced in response to the energy crisis caused by the war in Ukraine, is consistent with EU law.
In a most recent judgment, the European Court of Justice (ECJ) clarifies the conditions for determining the domicile for tax purposes of officials and other servants of the European Union.
Following a request for preliminary ruling from Poland, the European Court of Justice (ECJ) again is asked to address the framework of exit taxation and its method of collection. In her Opinion, the Advocate General proposes that the ECJ decide that, for example, deferring the tax payment for a maximum of 5 years is necessary in light of the legitimate objective for effective collection of the exit tax with no need to await the actual disposal of the relevant assets.
