The Austrian Federal Finance Court addressed the timing of a claw-back of foreign losses when the Austrian tax group is dissolved, and held the claw-back is made in the financial year of dissolution.
Under Austrian tax law, foreign companies in countries having mutual assistance agreements with Austria may join the Austrian tax group. As a result, tax losses derived by a foreign group member can be used by the Austrian tax group.
The allocation of foreign losses is, however, limited with 75% of the positive tax result of Austrian group members. Furthermore, in order to avoid double-loss utilization, previously allocated tax losses are clawed back if used in the country of origin of the foreign group member. Also, all previously used foreign tax losses need to be clawed back if the respective group member leaves the group or the group is dissolved.
The court’s judgment, thus addresses the timing of the claw-back of the foreign tax losses when the tax group is dissolved.
Read a December 2016 report [PDF 347 KB] prepared by the KPMG member firm in Austria
The KPMG report also includes discussions about:
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