Back to home
URL: http://www.deloitte-tax-news.de/german-tax-legal-news/bfh-confirms-favorable-trade-tax-treatment-of-dividends-under-tax-group-rules.html
24.03.2015
German Tax and Legal News

BFH confirms favorable trade tax treatment of dividends under tax group rules

The BFH has upheld a taxpayer-favorable decision by a lower court on the trade tax treatment of dividends distributed by a nonresident subsidiary to its German parent company that is a controlled company in a German tax group.

In a decision dated 17 December 2014 (I R 39/14), Germany’s federal tax court (BFH) upheld the taxpayer-favorable decision issued by the lower tax court of Muenster on the trade tax treatment of dividends distributed by a nonresident subsidiary to its German parent company that is a controlled company in a German tax group. (See Deloitte Tax News for a write up of the decision of the lower tax court of Muenster.)

In the underlying case, the dividends received by the controlled German entity were treated as fully exempt from trade tax. The lower court concluded that German tax law does not provide for an addback of 5% of the dividend income for trade tax purposes in tax groups.

The BFH rejected the appeal of the tax authorities on the same grounds as the lower tax court of Muenster by applying the tax rules for calculating taxable income within a German tax group.

www.deloitte-tax-news.de Diese Mandanteninformation enthält ausschließlich allgemeine Informationen, die nicht geeignet sind, den besonderen Umständen eines Einzelfalles gerecht zu werden. Sie hat nicht den Sinn, Grundlage für wirtschaftliche oder sonstige Entscheidungen jedweder Art zu sein. Sie stellt keine Beratung, Auskunft oder ein rechtsverbindliches Angebot dar und ist auch nicht geeignet, eine persönliche Beratung zu ersetzen. Sollte jemand Entscheidungen jedweder Art auf Inhalte dieser Mandanteninformation oder Teile davon stützen, handelt dieser ausschließlich auf eigenes Risiko. Deloitte GmbH übernimmt keinerlei Garantie oder Gewährleistung noch haftet sie in irgendeiner anderen Weise für den Inhalt dieser Mandanteninformation. Aus diesem Grunde empfehlen wir stets, eine persönliche Beratung einzuholen.

This client information exclusively contains general information not suitable for addressing the particular circumstances of any individual case. Its purpose is not to be used as a basis for commercial decisions or decisions of any other kind. This client information does neither constitute any advice nor any legally binding information or offer and shall not be deemed suitable for substituting personal advice under any circumstances. Should you base decisions of any kind on the contents of this client information or extracts therefrom, you act solely at your own risk. Deloitte GmbH will not assume any guarantee nor warranty and will not be liable in any other form for the content of this client information. Therefore, we always recommend to obtain personal advice.