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Germany: Treatment of “negative goodwill,” shareholding percentages, currency losses

Germany: Treatment of negative goodwill

The KPMG member firm in Germany has prepared a report that summarizes the following recent tax developments:


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  • Referral of a case to the Court of Justice of the European Union, for a determination as to whether German rules that require a transfer pricing adjustment for certain cross-border arrangements, but no adjustment for solely domestic arrangements, are consistent with EU law
  • A decision of the Federal Tax Court (BFH) concerning the balance sheet treatment and recognition of business assets with respect to contributions involving “negative goodwill”
  • A court decision concerning whether a percentage of shareholding is based on the actual conditions under the civil law as of the registration date, or whether the mere eligibility of a third party at the beginning of the calendar year to acquire shares (to the extent that the taxpayer’s shareholding would fall below the 10% threshold) is to be taken into account for purposes of determining the percentage of the shareholding
  • A court decision that currency and interest losses resulting from the sale of an interest-bearing purchase price claim from a tax-exempt sale of shares involving a deferral, as well as payment in a foreign currency has been agreed, may be qualified as a subsequent change in the gain on sale 
  • New law in Germany on electronic processing of tax returns and concerning other tax procedure changes


Read a 2016 report [PDF 336 KB] prepared by the KPMG member firm in Germany: German Tax Monthly

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