Tax & Legal

With regard to the refund of withholding tax on profit distributions made by a domestic subsidiary to its EU parent company, the Supreme Tax Court decided that these distributions are not excluded from the tax relief under the EU Parent-Subsidiary Directive if they relate to profits that, although distributed after the commencement of the subsidiary’s liquidation, were generated prior to the opening of the liquidation proceedings.

The General Court of the EU decided today that affected shareholders and creditors in the course of winding up Spain's ailing Banco Popular in 2017 were not entitled to compensation from the Single Resolution Fund, as they would not have received better treatment in the event of the liquidation of the bank than that resulting from its resolution.

The tax court of Muenster decided that the income from a dissolution of two US trusts be taxed as investment income in the hands of the beneficiary, except for income which accrued prior to 9 December 2010 (by protection of legitimate expectations).

The Supreme Court has held that the initial full loss offset on €1 m applies to each period of assessment, rather than to each calendar year. Thus it can only be claimed once for a multi-year assessment.