Categories: Constitutional Court (16 found)

1. 02.12.2025

   Constitutional Court: No general requirement for written agr ...

   In a ruling from May 2025, the Federal Constitutional Court decided that the lack of a written contract between related German companies is not sufficient ground for refusing the deduction of business expenses. Rather, an overall assessment must be made to determine whether the agreement actually took place, even if made verbally or implied.

   Categories: Constitutional Court

   Keywords: deduction, business expense, arm's lengt ...
2. 18.07.2025

   Federal Constitutional Court: Successful constitutional comp ...

   In a decision published today the Third Chamber of the First Senate of the Federal Constitutional Court (“FCC”) overturned various tax court decisions concerning the obligation to use the special electronic tax advisor mailbox (known as “beSt”).

   Categories: Constitutional Court

   Keywords: unconstitutional
3. 26.03.2025

   Federal Constitutional Court confirms solidarity surcharge

   In its judgment published today, the Second Senate of the Federal Constitutional Court confirms the solidarity surcharge in its current design and rejects the complaint brought by the six members of the liberal Party FDP.

   Categories: Constitutional Court

   Keywords: solidarity surcharge
4. 07.02.2024

   Complaint regarding the manner of video coverage of oral hea ...

   A constitutional complaint challenging the manner of video coverage of an oral hearing before the Munich Tax Court was not admitted by the Federal Constitutional Court. Specifically, the claim was about the use of only one camera without zoom function in a video hearing.

   Categories: Constitutional Court

   Keywords: legislation
5. 15.01.2024

   Constitutional Court: Tax privileged transfer of business as ...

   The Federal Constitutional Court held that § Section 6 (5) Income Tax Act providing for the transfer of business assets at book values to be incompatible with the German Basic Law insofar as it rules out a transfer at book value between partnerships with identical shareholding. This exclusion from the tax privilege is incompatible with the general guarantee of the right to equality and thus not justified.

   Categories: Constitutional Court

   Keywords: partnership, asset transfer
6. 17.03.2023

   Retroactive effects of over-surrenders from periods prior to ...

   The Federal Constitutional Court held that the retroactive introduction of Sec. 14 (3) Corporation Tax Act concerning the treatment of over-surrenders arising from periods prior to the membership in an Organschaft (tax consolidation group) to be in part unconstitutional and thus invalid.

   Categories: Constitutional Court

   Keywords: Organschaft, tax group, tax consolidatio ...
7. 08.02.2023

   Update: Provision for transition from imputation system to h ...

   The German Federal Constitutional Court has ruled that the transitional provision from the imputation system to the so-called half-income method in the course of the Annual Tax Act 2010 is partially incompatible with the German Basic Law and obliges the legislator to retroactively eliminate the identified constitutional violation by 31 December 2023.

   Categories: Constitutional Court

   Keywords: imputation system
8. 01.07.2022

   Income adjustment pursuant to Section 1 (1) FTA vis-à-vis a ...

   Following a referral from the Federal Constitutional Court, the Supreme Tax Court has again had to rule on the income adjustment pursuant to Section 1 (1) Foreign Taxes Act vis-à-vis the write-down of an unsecured loan receivable issued within a group

   Categories: Supreme Tax Court cases, Constitutional ...

   Keywords: income adjustment, International Tax, un ...
9. 14.01.2022

   Tax privilege granted for income from business profits over ...

   In a most recent decision, the Federal Constitutional Court held that the favorable tax treatment of income from trade or business, self-employment, agriculture, and forestry (so called ‘profit income’) versus taxable income computed on a cash-basis (“surplus income”) to be unconstitutional. This privileged tax treatment of income from profits, which only applied for 2007, is considered by the court as unequal and thus not justified.

   Categories: Constitutional Court

   Keywords: tax privilege income, profit income, sur ...
10. 30.11.2021

    Federal Constitutional Court: Inadmissible review of norm r ...

    In a decision published on 26 November 2021, the Federal Constitutional Court (Bundesverfassungsgericht,) declared as inadmissible a referral by the Supreme Tax Court (Bundesfinanzhof) regarding Section 3 of the Solidarity Surcharge Act 1995 as amended on October 15, 2002 (SSA, 1995).

    Categories: Constitutional Court

    Keywords: solidarity surcharge, corporate income t ...
11. 18.08.2021

    Statutory interest rate levied on late payment or refund of ...

    In a decision on two joint cases published today the Constitutional Court decided that interest incurred on late payment of taxes (back taxes) and the interest paid for tax refunds pursuant to Sections 233a and 238(1) sentence 1 of the German Fiscal Code is not in line with the German Constitution insofar as the interest rate is set at 0.5% per month and for interest periods from 1 January 2014.

    Categories: Constitutional Court

    Keywords: statutory interest rate, late payment in ...
12. 09.04.2021

    Successful constitutional complaint against income correctio ...

    The German Constitutional Court overturned a 2019 judgment of the Supreme Tax Court regarding the erstwhile change in its case law on the issue of the income correction with respect to an unsecured group loan because the tax court failed to submit the facts of the case to the European Court of Justice (ECJ) for final clarification and thus violated the complainant's right to the lawful judge under Article 101(1) of the Constitutional Statute.

    Categories: Constitutional Court

    Keywords: allocation of taxing rights, income corr ...
13. 12.04.2018

    Constitutional complaint regarding the trade tax treatment o ...

    In a decision on 10 April 2018, the German Constitutional Court concluded that the complaint that the trade tax treatment of gains from the disposal of partnership interests was unconstitutional because it contravened the principle of equality was not justified.

    Categories: Constitutional Court

    Keywords: trade tax, Principle of equality, Princi ...
14. 12.04.2018

    German Constitutional Court ruling on property valuations fo ...

    On 10 April 2018, the German Constitutional Court pronounced as unconstitutional the provisions on the valuation of property for the purposes of real estate tax and demanded new regulations

    Categories: Constitutional Court

    Keywords: Taxation of real estate, Principle of eq ...
15. 19.10.2017

    Standard actuarial interest rate for pension provisions of 6 ...

    The Cologne Tax Court considers the standard actuarial interest rate of 6 % applied for the calculation of pension provisions under Section 6a of the Income Tax Act in 2015 to be unconstitutional. It has suspended the appeal and referred the matter to the Constitutional Court for that Court to consider the constitutionality of the standard rate.

    Categories: Constitutional Court

    Keywords: pension provision, Interest rates, Actua ...
16. 12.10.2017

    Referral to Federal Constitutional Court: trade tax on the ...

    The First Senate of the Federal Constitutional Court heard arguments on the constitutionality of a provision in the Trade Tax Act, according to which trade tax was levied on the sale of business interests. The case has opened up a question of principle with regard to trade tax.

    Categories: Constitutional Court

    Keywords: trade tax, Income Tax Act