Tax & Legal News – Issue 2, March 2014

In this issue: PwC Reports, Official Pronouncments, Supreme Tax Court Cases, From Europe and From PwC.

PwC Reports

  • OECD publishes new standard on automatic information exchange

Official Pronouncements

  • Employer contributions to social security schemes in other member states tax-free benefit
  • VAT on motor vehicle leasing
  • VAT on services for wind farms
  • VAT on travel agents’ charges to airlines
  • Input tax from fraudulent supplier
  • Impairment of value of assets
  • Decree on private use of electric-powered company cars

Supreme Tax Court Cases

  • No deduction for EC fine for cartel offence
  • Fine payment for employee is taxable benefit
  • No treaty override for German-resident aircrew of Irish airline
  • Interest on tax refunds taxable
  • Loss on sale of variable interest bond can only be offset against capital gains
  • Shortest distance to work independent of road type
  • No liability for tax on benefits granted privately
  • No insurance tax for warranty risks on construction work abroad insured within EU/EEA
  • Project consideration in a public/private partnership split for VAT between interest and principal
  • Partnerships to join VAT groups?
  • No damages for excessive court delay leading to favourable result

From Europe

  • German rule on taxation of hidden reserves on contribution of business for shares upheld
  • SME definition not purely formal
  • Lower taxi VAT rate only justified if noticeable difference in the service
  • No deduction from travel agent’s turnover for discounts given to travelers
  • Exclusion of domestic sub-subsidiaries from tax group conflicts with freedom of establishment?

From PwC

  • Doing Business and Investing in Germany
  • Breaking news
  • BEPS – The state of play


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