Tax treatment of company events
Staff and management can get together for the annual company outing, the Christmas party or also an…
read moreTransfer pricing rules for financing transactions
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Working abroad - Tax equalisation and tax protection in the new ‘183-day circular’
During a period of working abroad, employers and employees normally conclude tax equalisation agreements. The…
read moreSustainability reporting - A step-by-step guide
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Accounting treatment of the purchase of receivables at below their nominal value in the case of restructuring
If a partner has purchased a receivable against the company at below its nominal value and subsequently waives…
read moreArtificial intelligence in M&A transactions - Impacts on the due diligence process
Artificial intelligence (AI) is also increasingly being used in corporate transactions. In the following…
read moreDraft bill for the 2024 Annual Tax Act
While it was only recently, in March 2024, that the German Growth Opportunities Act was passed, now already,…
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The relocation of production abroad - What are the tax implications that need to be considered?
The relocation of production abroad is no longer a possible scenario solely for large corporate groups. Rising…
read moreSustainability reporting - A step-by-step guide
The first two parts of our series of articles on sustainability reporting provided a comprehensive overview of…
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Request for information - A violation of the GDPR would not already constitute a basis for claiming compensation
Thanks to the General Data Protection Regulation (GDPR), employees have the right to seek information from…
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Too high a VAT amount stated on invoices to final consumers – The new regulations
Up to now, under Section 14c (1) of the VAT Act (Umsatzsteuergesetz, UstG), businesses have been obliged to…
read morePrivate real estate sales in the context of succession cases and own-use
Recently, a number of new court rulings with respect to private sales transactions involving real estate were…
read moreSale of partnership interests – Earn-out payments only have to be taxed when they are received
When stakes in a partnership are sold, besides a fixed purchase price, the contracting parties sometimes also…
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German Growth Opportunities Act ‘lite’ - What has remained?
In the following section we provide an overview of the amendments made to the Growth Opportunities Act within…
read moreSustainability reporting - A step-by-step guide
The EU passed the so-called Corporate Sustainability Reporting Directive (CSRD) with a view to improving and…
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No VAT on students’ cake sales
From 2025, Germany’s public sector will also be generally subject to VAT. This will affect, among others,…
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Protection against the loss of tax revenues caused by cross-border arrangements
The different tax treatment of a situation in two disparate states can lead to the creation of structures that…
read moreChanges related to electricity tax relief from 2024
Through the 2024 German Budget Financing Act, which came into force on 1.1.2024, lawmakers approved changes…
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Real estate tax – Subsequent determination of assessed value and updating the value
Real estate owners had until 31.1.2023 to submit a real estate tax return as at the date of the main…
read moreTax-neutral transfers between affiliated partnerships
Section 6(5) sentence 3 of the Income Tax Act (Einkommenssteuergesetz, EStG) legally specifies that in the…
read moreMoving house for a better home office – Relocation costs could be tax deductible
During the COVID-19 pandemic, many professionals with small homes realised that as a result of working from…
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New clarifications with respect to transfer pricing
Federal Fiscal Court (Bundesfinanzhof, BFH) rulings on transfer pricing issues are rare and, therefore,…
read moreTax planning by means of a usufruct in favour of children
The transfer of a source of income to (under-age) children via the establishment of a gratuitous usufruct has…
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Large-scale project planning – the construction of a logistics centre
Bei der Planung eines Großprojekts – wie dem Bau eines Logistikzentrums – treten neben bautechnischen und…
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Documentary evidence of arrival for intra-Community deliveries – Using the EMCS procedure
Under the German VAT Implementing Ordinance, a business owner can provide documentary evidence of the arrival…
read moreFive-year period and three properties limit – Criteria for commercial trading in property
When a property is purchased and sold shortly afterwards this could give rise to a taxable capital gain. If…
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Introduction of a ‘plastic tax’ from 2024
Single-use plastic products that have been improperly disposed of constitute a notable source of environmental…
read moreLarge-scale project planning – the construction of a logistics centre
When planning large-scale projects - such as the construction of a logistics centre -, besides structural…
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M&A in times of crisis – Current trends and challenges in respect of corporate transactions
A pandemic, war and inflation – over the past months, these crises and the resulting effects have severely…
read moreImplementation of ESG standards at DAX companies
The adoption of the Corporate Sustainability Reporting Directive (CSRD) and its specification in the European…
read moreEU Commission presents SME Relief Package
Small and medium-sized enterprises (SMEs) are a key driver of Europe’s green and digital transitions. For this…
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Payroll tax deductions when staff are deployed across borders
In the global workplace, and against the backdrop of the current worldwide skills shortage, staff are…
read moreTaxation of free-float dividends
Dividend income or profit distributions that a corporation receives from its shareholding in another…
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Acquisition of the family home – Extent of inheritance tax concession under review
In accordance with the provision of Section 13(1) no. 4c sentence 1 of the Inheritance Tax Act…
read moreMonetary policies of central banks as a key factor affecting business financing
High inflation rates are currently hampering economies overall throughout the world. In Germany, the inflation…
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New requirements for the audit of IT systems in accordance with ISA DE 315
The requirements of a new auditing standard are creating challenges for auditors and therefore, indirectly,…
read moreBusiness intelligence solutions for enhanced business process monitoring
In the present digital era, businesses are generating vast amounts of data that provide valuable insights and…
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The German Growth Opportunities Act – Improvements of loss deduction and depreciation options
On 30.8.2023, the Federal Cabinet approved a government draft of the Growth Opportunities Act…
read moreWorkroom at home vs. home office blanket allowance
The tax deductibility of the costs and blanket allowances, respectively, for a workroom at home and a home…
read moreNew forms of working – ‘Remote Work’ and the ‘Workation’ (Part II: Important aspects of tax and social security law)
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Workplace health promotion in the fitness studio
Under Section 3 no. 34 of the German Income Tax Act, employers are able to provide an attractive benefit to…
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Major changes to international tax law as of 1.1.2024
The Federal Ministry of Finance (Bundesministerium der Finanzen, BMF) published a draft omnibus act…
read moreE-invoicing in Germany – Preparations are required
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Determining ‘fair’ business value – Adjustments for heightened uncertainty
Business valuation already previously frequently resulted in arguments about the ‘correct’ or ‘fair’ value. In…
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Shorter useful life – How faster tax depreciation of real estate can be achieved
Fixed tax depreciation rates based on standardised useful lives mean that real estate users have only limited…
read moreReciprocal sales – Rotating holdings at below their value will not be recognised for tax purposes
Tax saving potential cannot be generated by rotating the holdings of two shareholders in a GmbH [German…
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Update on trade tax add-backs of rental and lease payments
In recent years, trade tax add-backs have frequently been the subject of disputes between taxpayers and the…
read moreE-charging stations – Accounting for their acquisition and maintenance by companies
In the course of the energy transition process, electromobility is being encouraged in a number of ways. It…
read moreESG reporting – Measuring non-financial performance on the basis of the Women’s Career Index (Frauen-Karriere-Index, FKI)
While, in the past, sales revenue and profit were regarded as the sole criteria for economic success, these…
read moreWorkplace health promotion in the fitness studio
Employers are able to provide an attractive benefit to their employees in the form of tax-free payments for…
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Increased tax-exempt amount for vocational training – How parents can reduce their tax burden
When children are studying or undertaking vocational training their parents frequently help them out…
read moreNew ruling on exit tax by the Bundesfinanzhof
Under the German Foreign Transactions Tax Act, exit tax has to be paid by those who hold substantial stakes in…
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Beware the tax trap in the case of share deals
The fundamental changes to the Real Estate Transfer Tax Act (Grunderwerbsteuergesetz, GrEStG) are now…
read moreSale of properties held as private assets – Recognise and avoid the tax pitfalls
Capital gains on personal property are not generally subject to income tax. Even the capital gain on a…
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Compensation payments made to tenants as immediately deductible expenses
According to a ruling recently issued by the Federal Fiscal Court (Bundesfinanzhof, BFH), payments made to…
read moreTaxation in Germany of remuneration from abroad
If an employee residing in Germany works abroad then the question that arises is if and to what extent the…
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Building assets with ETFs in an asset management GmbH [limited liability company] as opposed to private assets (Part 2)
Zinseszinseffekte während des Vermögensaufbaus werden maßgeblich durch Steuerwirkungen beeinflusst. Hier liegt…
read moreEmployee bonuses where there is no legal entitlement – A provision is nevertheless possible
A provision for liabilities of uncertain timing or amount presupposes, among other things, that payment is…
read moreUsufruct of a benefit as abusive structuring?
When usufruct agreements are made between, in particular, parents and their (under-age) children, disputes…
read morePension commitments – No provision where there are harmful reservations
The requirements for creating a provision within the meaning of Section 6a of the Income Tax Act…
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Withholding tax for construction services and its tax risks for businesses, lessors & Co.
The German fiscal administration recently revised its approx. 20-year-old circular on the application of…
read moreDevelopments as regards German tax groups for VAT purposes
We have had no less than two rulings on German tax groups for VAT purposes within a short space of time. For…
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Relief provided by the energy price brakes
The German government introduced ‘energy price brakes’ in response to the sharp increases in energy prices and…
read moreBuilding private assets with ETFs during a period of rising interest rates
The effects of compound interest while building assets are mainly impacted by the tax implications. This…
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A managing director’s liability after leaving the executive board?
If a GmbH [private limited company] ceases to comply with certain obligations, such as, e.g., transferring the…
read moreWhere would a financial settlement be taxed following a move to a foreign country?
When a move to a foreign country follows the termination of an employment relationship a question that arises…
read moreTax-reducing provision for age-related free time
Businesses that give their employees additional days off from work in the form of age-related free time can…
read moreNew conditions for the adjustment of an invoice where the VAT is incorrectly stated
The ECJ has stated its position on a request from Austria for a preliminary ruling. This ruling is also…
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VAT in the Digital Age – Implications of digitalisation for the VAT system in the EU
On 8.12.2022, as part of its VAT in the Digital Age (ViDA) initiative, the EU Commission published a…
read morePer country limitation when claiming foreign tax credit
Under German tax law, the crediting of foreign taxes against German corporation tax constitutes one of the…
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New standards for cash register systems – What operators of cash register systems will have to consider in the future
Since 1.1.2020, businesses have had to comply with the new legal provisions of the Cash Register…
read moreNew build rental apartments – Special depreciation allowance of 5% per year will be re-introduced
To encourage the new construction of rental apartments, in 2019 already, German lawmakers introduced a special…
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New model form for supplies of goods for export in cases of handling and processing
The Federal Ministry of Finance (Bundesministerium der Finanzen, BMF) has published a new model form for a…
read moreTreating fees as pass-through expenses
An expense will be deemed to be a pass-through expense if the business that collects and disburses such…
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Modernisation of external tax audits – Few advantages and extensively expanded obligations
In recent years, various measures have been taken in respect of external tax audits or tax audits (TA), which…
read moreNew reporting obligations for digital platform operators
The so-called Platform Tax Transparency Act (Plattformen-Steuertransparenzgesetz, PStTG) has been in force…
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Changes to the German Valuation Act – Hidden inheritance tax rises due to increased property values?
Changes to the Valuation Act (Bewertungsgesetz, BewG) came into force together with the 2022 Annual Tax Act…
read moreDisposal of a business in return for a pension – Right to choose between immediate taxation and inflow taxation
According to a German supreme court ruling, those who dispose of their businesses and, in return, allow…
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How high inflation impacts financial reporting according to HGB and IFRS
In 2022, inflation accelerated markedly around the world. In view of the large number of significant…
read moreThe multi-tier group – Which is the controlling company and which is the dependent company?
In the event of intra-group restructuring, under certain conditions, it is possible to avoid real estate…
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Changes in the taxation rules applicable to photovoltaic systems – Part II – VAT treatment
read moreDetermining customs values for transactions between affiliated companies – Are subsequent adjustments allowed?
In the case of transactions between affiliated companies, the fiscal administration likes to presume that…
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Recognition for tax purposes of the costs of studying abroad
A course of study in a foreign country usually entails additional costs. Whether or not and to what extent the…
read moreVoluntary capital contributions to increase the amount of loss relief in the case of partnerships
In the case of partnerships, a partner may normally deduct losses, for tax purposes, solely up to the amount…
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Recognition of an agreement as an invoice – Current ECJ requirements
The ECJ has expressed its view on the question of whether or not an agreement may be regarded as an invoice…
read moreApplication of International Standards on Auditing (ISA) in Germany
The auditing standards of the Institute of Public Auditors in Germany (Institut der Wirtschaftsprüfer, IDW)…
read moreGerman Real Estate Transfer Tax – Notification of a unification of shares
Real estate transfer tax (RETT) is payable not just on property acquisitions. It can also arise if, for…
read moreRefurbishment expenses that can be immediately deducted after withdrawal of a residential property
If extensive maintenance and modernisation measures are carried out at rental properties within three years of…
read moreChanges in the taxation rules applicable to photovoltaic systems – Part I – Income tax treatment
In some German federal states, the installation of photovoltaic (PV) systems on all new non-residential…
read moreIntroduction of a levy to skim off windfall profits for quantities of electricity generated from renewable energy sources
The war in Ukraine has resulted in enormous upheavals on European energy markets. In the course of this, some…
read moreProvisions for bonus points – New recognition requirement for many businesses
A great number of businesses – even smaller ones, such as, pharmacies or bakeries – use bonus point systems or…
read moreTax-exempt sale of property – Self-use in the year in which the sale takes place is essential
If property that is held in private assets is sold before the end of the ten-year speculation period then the…
read moreDealers’ guarantee commitments – Insurance premium tax treatment and VAT treatment
The Tax Law Committee of the German Association of Tax Advisers (Deutscher Steuerberaterverband e.V., DStV)…
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