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.
The Federal Ministry of Finance has sent the draft of a Ministry circular on the application of Section 8d of the Corporation Tax Act (CTA) – continuance-bound loss carry-forward after loss forfeiture - to the professional associations for comment.
The Supreme Tax Court has held that an upstream merger leads to new assets in the accounts of the parent (surviving entity) and thus to forfeiture of that company’s remaining loss carry-forward if the new assets are substantial.
The Supreme Tax Court has held that a downstream, but not an upstream, merger leads to new assets for the surviving entity that can imperil its loss carry forward.
