Germany: Tax law measures enacted | KPMG | GLOBAL

Germany: Tax law measures enacted include “anti-patent box” provisions

Germany: Tax law measures enacted

The legislative processes have been completed concerning the following tax legislative items:

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  • The “anti-patent box law” was enacted in June 2017 and limits the deductibility of royalty expenses and other expenses for licensing rights to related parties.
  • The law on tax avoidance was enacted in June 2017 to address items such as preventing situations when special business expenses are deducted twice.

Also, new regulations were published regarding the documentation of profit allocations (generally in line with the recommendations under the OECD’s base erosion and profit shifting (BEPS) project).

In the courts, there were judgments concerning:

  • Partner contributions in tax groups (BFH)
  • The penalty imposed on a company when an executive evaded taxes for the benefit of the company
  • A referral to the Court of Justice of the European Union on anti-treaty / anti-directive shopping rules 
  • Add-back of a dividend distribution by a non-resident French subsidiary
  • A pledge of shares in the context of thin capitalization 

 

Read an August-September 2017 report [PDF 355 KB] prepared by the KPMG member firm in Germany

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