German update

30.07.2019
Draft of the 2019 Annual Tax Act – New VAT regulations and other important individual measures

Averting abusive tax structuring and the necessary adaptations of German tax laws to bring them into line with court judgements were the reasons behind the publication, on 8.5.2019, by the Federal Ministry of Finance (Bundesministerium der Finanzen, BMF) of a draft bill for the proposed “Act to promote further tax incentives for electromobility and to amend other tax regulations”. Other significant new regulations are set out below, in particular those relating to VAT. In addition, we have provided information on the affiliation privilege for trade tax purposes, real estate transfer tax in the case of share deals and subsistence expenses.

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29.07.2019
Foundation of a permanent establishment due to the residence of a managing director

In Germany, national requirements determine whether or not an agency permanent establishment exists and thus also the limited tax liability there. These conditions have been specified by administrative opinion and court rulings. The Federal Fiscal Court (Bundesfinanzhof, BFH), in its latest ruling, has now widened the scope.

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28.07.2019
A community of part owners does not constitute a VATable business entity

Communities of part owners are not business entities from a VAT point of view. The Federal Fiscal Court (Bundesfinanzhof, BFH) recently decided this in its ruling from 22.11.2018 and thus changed its previously held legal position.

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27.07.2019
26.07.2019
New rules for DTA-related dispute resolution

The Act on the Resolution of Disputes between Germany and other EU Member States (EU-Doppelbesteuerungsabkommen-Streitbeilegungsgesetz, EU-DBASBG) shall apply to all complaints about double taxation of income or capital, between EU states, that have been lodged since 1.7.2019. Here, the temporal scope of application of the EU-DBA-SBG shall cover cases that relate to tax periods beginning after 1.1.2018. The EU-DBASBG is currently still at the draft bill stage. In terms of its contents, the draft bill is closely based on the underlying EU directive. It can be assumed that this version of the Act will come into force.

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