On 6 June 2023, the Federal Ministry of Finance published its new principles for the correction of income pursuant to Section 1 External Tax Relations Act on its website. These are to be applied to all open cases with immediate effect. Only the chapter on relocation of
functions is applicable to cases that are realised after 31 December 2021.
The Supreme Tax Court issued a further landmark ruling in the area of intra-group financing by which the court strengthens the consideration of risk premiums for subordinated and unsecured loans.
In a most recent judgment, the Supreme Tax Court decided on the transfer pricing method to determine an arm's length interest on intercompany loans. In its decision the highest tax court also provides some guidelines on the parameters to be observed from a purely tax point of view. Also, the court takes time to compare the adequacy of the various standard methods under review.
