The Federal Ministry of Finance has agreed with the Federal Ministry of Economics (“the Ministries”) on a far-reaching bundle of measures to protect jobs and safeguard companies of all sizes and in all sectors. These measures include tax liquidity support for companies. The measures were set out in a notice released on 13 March 2020. Continue reading
Tax & Legal
In a judgement of 5 March 2020 the European Court of Justice (ECJ) dealt with the question whether telephone advisory services provided by a company on behalf of state health insurance funds through so-called “health coaches” may be free from VAT. The ECJ held that VAT exemption may indeed apply, provided the services have a therapeutic or curative objective and are of a comparable level of quality as the services provided by other suppliers in this field. Continue reading
Expenses for an apartment are only deductible as double-household expenses incurred in advance if the taxpayer has made a conclusive decision to use the apartment in the future as part of a double-household deductible for tax purposes. Whether this is the case must be decided through an overall assessment of the objective circumstances of the individual case. Continue reading
The tax exemption from real estate transfer tax (RETT) in the event of restructuring within a group under Section 6a of the Real Estate Transfer Tax Act (RETTA) does not constitute State Aid prohibited by EU law. It can also apply to cases where a dependent company is merged with a controlling company. This was decided by the Supreme Tax Court in its ruling of 22 August 2019 – II R 18/19, published on 13 February 2020. Continue reading
The Supreme Tax Court had asked (decision of 13.03.2019 – I R 18/19) the European Court of Justice (ECJ) whether Article 107(1) Treaty on the Functioning of the European Union (TFEU) was to be interpreted as meaning that State Aid existed where, under the rules of a Member State, (permanent) losses – incurred by a company from an economic activity maintained without receiving sufficient remuneration to cover its costs – are in principle to be regarded as hidden dividend distributions and accordingly may not reduce the profit of the company, but, in the case of companies in which the majority of voting rights are held directly or indirectly by legal persons governed by public law, those legal consequences are not to be applied to permanent losses arising if such “public” corporations carry on the activities for reasons of transport, environmental, social, cultural, educational or health policy. Continue reading
Where a member of a supervisory board receives a non-variable fixed salary for his services and as a result does not bear any risks vis-à-vis his remuneration, he is not acting as an entrepreneur. This was decided by the Supreme Tax Court in its ruling of November 27, 2019 – (V R 23/19 / R 62/17), thereby abandoning earlier case law. Continue reading
The Supreme Tax Court held in its ruling of 10 December 2019 (IX R 23/18) that a final tax assessment can no longer be corrected by the tax office under Section 129 of the German Tax Code (“GTC” – obvious errors while issuing administrative acts) if the incorrect assessment of a capital gain whisch was correctly declared by the taxpayer under 17 of the German Income Tax Act was not based on a mere “mechanical error”. Continue reading
Issue 1 of the Tax & Legal News for 2020 contains includes news from the Supreme Tax Court and the Finance Ministry: Continue reading
On 28 January 2020 the Federal Finance Ministry issued a circular regarding the reporting of consignment stock transactions on the European Sales List. Continue reading
Midnight tonight the United Kingdom of Great Britain and Northern Ireland will leave the EU. From 1 February, a transitional phase until the end of 2020 will begin, which means that for the time being, the UK will remain within the internal market and the customs union. Is your business prepared for what may come? Some many open questions. The free PwC-Brexit Readiness Assessment Application can help. Continue reading