12.11.2019
Reform of the real estate tax and valuation law is on the home straight

We knew for a long time that real estate tax is in need of reform. Then, on 10.4.2018, the Federal Constitutional Court declared that the valuation rules were unconstitutional. According to the court’s ruling, a new law has to be passed by 31.12.2019, otherwise no new tax assessments may be issued as of January 2020.

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11.11.2019
Real Estate Transfer Tax – Latest developments in the legislative procedure

Since 2016, policy makers have been pursuing the aim of tightening up the real estate transfer tax (RETT) rules for so-called share deals. It is argued that, among things, RETT is always incurred when private individuals purchase their own homes, yet large real estate investors are able to avoid this tax through share deals. A specific reform law is now the subject of a legislative procedure.

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10.11.2019
Trade Tax – A new Federal Fiscal Court ruling on the extended deduction for owned real estate

In 2019, the Federal Fiscal Court (Bundesfinanzhof, BFH) has ruled on several cases related to the extended deduction for owned real estate for trade tax purposes. This subject matter frequently leads to discussions with the fiscal authority.

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09.11.2019
Transfer pricing formation using the TNMM

The TNMM (transactional net margin method) is a transactional profit method for transfer pricing formation where the net margin of the supplying business is adjusted on the basis of the individual accounting transaction in accordance with arm’s length principles. For a long time, the German fiscal authority has taken a rather critical attitude towards this method. Internationally, it has already been established for a longer time and is even accepted in German transfer pricing practice.

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08.11.2019
Taxation of the digital economy is on the horizon – OECD proposal for a unified approach

The OECD has responded to the new business models that have arisen in the course of the digital transformation and, on 9.10.2019, it presented a proposal for the allocation of taxing rights. A key aspect of this ‘unified approach’ is establishing a connection with sales irrespective of any physical presence. This concept will radically change the international tax system that has traditionally been based on subsidiaries and permanent establishments.

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