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Tax & Legal

Tax & Legal

Present rules for full forfeiture of loss relief where more than 50% of the shares are transferred also unconstitutional?


On 29 August 2017, the Lower Tax Court of Hamburg referred a further request to the Constitutional Court on the constitutionality of the rules on the full forfeiture of loss relief under Section 8c 2nd Sentence of the Corporation Tax Act, namely where more than 50% of the shares in the loss making company are transferred (second alternative of Sec. 8c Corporation Tax Act). The Lower Tax Court is convinced that this rule is also unconstitutional. Continue reading

Curtailment of loss relief for companies in part unconstitutional


The German Constitutional Court held that the rules for curtailment of loss relief on change of shareholders to be in breach of the formal provisions of the constitution under the principle of equal treatment insofar as changes of more than 25% and up to 50% of the shares in a company within a period of five years are concerned. Continue reading

Pre-accession relief rule applicable until Commission rules otherwise?


 

The advocate general on an ECJ case on special case exemption from a loss curtailment provision has suggested the court hold the exemption rule to be of pre-accession provenance and thus not to be disapplied as unauthorised state aid unless and until the Commission has come to that conclusion on the basis of a properly completed formal proceeding.  Continue reading