Tax & Legal

The German anti- treaty shopping rule denying full or partial relief from withholding tax, as otherwise prescribed under a double tax treaty or applicable EU directive, is questioned by the Lower Tax Court of Cologne as being in violation of community law. The question has been referred to the ECJ in number of cases.

The Supreme Tax Court has held that a dividend paid to a US S corporation on a holding of at least 10% is subject to a 5% withholding tax insofar as its shareholders are tax-resident in the USA.