German tax law - vdma.org

Bundesfinanzministerium legt Referentenentwurf für ein steuerliches Investitionssofortprogramm 2025 vor Die neue Bundesregierung will die steuerlichen Investitionsbedingungen zügig verbessern. Der nun vorgelegte Referentenentwurf (Anlage) soll wichti

This article examines the principles of restructuring provisions under commercial and tax law as well as the requirements and special features of their formation in the tax balance sheet.

The most important regulations of the current legal situation on the subject of loss deduction in income tax, corporation tax and trade tax are summarized here.

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The Annual Tax Act 2024 is a constructive compromise. Now measures for industry must follow, such as improved declining balance depreciation.

The Federal Ministry of Finance has published a discussion draft for a Minimum Tax Adjustment Act (MinStGAnpG). The main aim of the law is to make the application of the CbCR safe harbour more specific.

For almost a year now, taxpayers in Germany have been able to apply for a digital trade tax assessment directly via the ELSTER portal when submitting their trade tax return. A project that is constantly evolving.

We are pleased to introduce our new event series "Automation in the Tax Department".

The Budget Financing Act 2024 (Federal Law Gazette 2023 I No. 412 of 29.12.2023) extended the application-based electricity tax relief for companies in the manufacturing sector with effect from 1.1.2024.

In its ruling of 23.11.2023 (case reference: VI R 15/21), the Federal Fiscal Court (BFH) provided important information on lump-sum taxation in accordance with Section 37b EStG in connection with VIP boxes and the scope of their benefits.

Expenses for warranty and goodwill costs have also stabilised at a low level. This applies in particular to larger companies, which are disproportionately represented in the survey of these figures.

At the end of January, the Research Allowance Certification Office updated the form for applying for the research allowance.

The Federal Central Tax Office (BZSt) is currently informing the associations about upcoming changes in the tax withholding procedure according to § 50a EStG.

On July 17, 2023, the German Federal Ministry of Finance presented a draft bill of the so-called Growth Opportunities Act, which, among other things, provides for a new regulation of the deductibility of interest (as of January 1, 2024).

The VDMA's regional associations have a long tradition of organizing tax events. We will be offering these events again in the first half of 2024. We give you a small preview of when and where!

The BMF has published its first discussion draft for the national implementation of the global minimum tax in Germany.

After the federal government has already agreed on various measures to reform and accelerate the external tax audit, the coalition has now surprisingly launched another innovation and lays the first foundation stone of a system audit

For some years now, the tax authorities have been trying to speed up external tax audits. Now the measures are available within the framework of a bill.

For some years now, the tax authorities have been trying to speed up external tax audits. Now the measures are available within the framework of a bill.

The German Federal Ministry of Finance is again extending the simplification rules for the income tax treatment of so-called register cases. This will now continue to apply until 2023.

The Federal Ministry of Finance has issued an updated letter regarding the tax recognition of entertainment expenses. The main focus is on new document requirements due to the Cash Security Protection Ordinance and principles for digital or digitised documents.

On the occasion of the current flood disaster, the federal states of North Rhine-Westphalia and Rhineland-Palatinate have published disaster decrees with simplification regulations.

As a result of the Act to Modernise Corporation Tax Law (KöMoG), partnerships will in future have the option of being taxed in the same way as a corporation.

For a long time, there was an incongruity regarding the tax treatment of exchange rate effects in connection with loans between related companies.

The German Corporate Income Tax Modernisation Act (KöMoG) changes the tax balance sheet treatment of excess/shortfall transfers by corporate tax groups.

Hesse will make use of the opening clause (Art. 72 Para. 3 S. 1 No. 7 GG) and introduce an area factor procedure.

After more than a year of deadlock, the governing parties have agreed on new regulations on share deals in the real estate transfer tax.

Debtors of a foreign royalty payment are generally obliged to withhold tax. Up to now, the exemption procedure offered relief in this respect. This is now reformed by the new § 50c EStG.

Until now, the crediting of foreign withholding tax was only known in connection with income or corporation tax. The FG Hessen now affirms this possibility also for trade tax.

Lower Saxony will make use of the opening clause (Article 72 (3) sentence 1 no. 7 GG) and introduce an area-location model.

The standstill in German corporate tax law has long been criticised. Gradually, Germany moved from the middle of the pack among industrialised nations to the top in terms of tax burden. At the same time, structural reforms have been piled up for years. But now the government can no longer stand by and watch.

On 19 January 2021, the Conference of Minister Presidents not only took up the extension of the lockdown, but also a tax policy project from the coalition agreement.

The governing parties have been arguing for a long time about the further content of the Annual Tax Act 2020. The coalition has also agreed on amendments to the Research Allowance Act (FZulG). The law was passed by the Bundesrat on December 18, 2020.

Bavaria will make use of the opening clause (Art. 72 para. 3 sentence 1 no. 7 GG) and introduce an area model. To this end, the state government has now presented a draft bill and also provided initial details in its press release of 8 December 2020. Bavaria thus deviates from the federal model

Hamburg will make use of the opening clause (Article 72 (3) sentence 1 no. 7 of the German constitution) and introduce the Wohnlagemodell". This was announced by the state government in its press release of 02.09.2020. Hamburg thus deviates considerably from the federal model and adapts the equivalence model for real estate tax purposes.

Baden-Württemberg will make use of the opening clause (Article 72 (3) sentence 1 no. 7 of the Basic Law) and introduce a land value tax. This was announced by the state government in its press release of 28.07.2020. Baden-Württemberg thus deviates considerably from the federal model. The federal state has now published a draft law.

Already at the end of 2019, the Bundesrat passed the legal basis for the reform of the property tax. The central element of the reform is the possibility for the federal states to develop their own approaches (so-called opening clause) for the necessary property valuation (deviating from the so-called federal model). In the following, we provide an overview of the implementation status in the individual federal states.

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At a federal press conference yesterday, a spokeswoman of the Federal Ministry of Finance announced that the DAC-6 moratorium will most likely not be implemented in Germany.

On 30.6. the tax authorities published the final BMF letter on the reduction of VAT.

The EU member states have agreed to harmonise the obligations to provide evidence for intra-Community deliveries, which are important in our industry, with Art. 45a of the EU Regulation No. 282/2011.

The BMF had already announced various tax measures to secure liquidity under the heading "Tax Liquidity Assistance".

At the request of the BDI, the BMF has commented on the handling of the receipt obligation (Section 146a (2) AO) in company canteens, which has existed since 01.01.2020. This is a clarification regarding the current legal situation.

The coalition committee is dealing with taxation that is neutral in terms of legal form. Dr. Ralph Wiechers, member of the VDMA Executive Board, explains:

At the end of February, the Federal Ministry of Finance finally published a first draft bill for a research allowance law.

In June 2018, the Federal Ministry of Finance (BMF) published a new decree dated June 14, 2018 concerning the granting of a suspension of the execution of interest pursuant to sections 233 and 238 (1) AO for interest periods beginning 2015 onwards. This scope is now extended to interest periods beginning 2012 by the new decree of the BMF dated December 14, 2018.

In 2017, the basis for the tax exemption of restructuring profits was already created within German tax legislation(sec. 3a Income Tax Act and sec. 7b Trade Tax Act). However, the entry into force has so far been subject to reservation for reasons of state aid law. In the course of the Annual Tax Act, the regulations are now finally coming into force.

In 2017, the German Federal Fiscal Court ruled that fiscal unities cannot be recognised for tax purposes, in case variable compensation payments will be done to minority shareholders of controlled companies in addition to fixed compensation payments. Now the legislator is reacting with an amendment of sec. 14 para. 2 Coporate Income Tax Act.

Due to a change in German income tax legislation, interest will be determined for taxes on capital gains resulting from sales of certain assets within the meaning of section sec. 6b para.1 of the German Income Tax Act, provided that no reinvestment takes place in other EU/EEA countries. The new regulation already apply from fiscal year 2018 onwards.

As a result of the Family Relief Act, there will be several changes in German income tax legislation, effective as of January 1, 2019 . The changes relate to the areas of the basic allowance, the income tax rate, the child benefit as well as the child allowances.