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Germany: Royalty payments made to non-EU recipients

Germany: Royalty payments made to non-EU recipients

The KPMG member firm in Germany has prepared a report that includes discussions about the following tax developments.


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  • The lower tax court of Cologne issued a decision finding that there are no concerns under EU law regarding the application of an anti-treaty shopping directive to royalty payments made to recipients in non-EU countries. Under German tax law, a reduction of withholding tax is subject to a condition that the recipient satisfies the “activity requirement” under the anti-treaty shopping directive.
  • The EC sent a formal notice to Germany requesting recognition of profit and loss transfer agreements (that are a pre-condition for tax consolidation) that have been concluded under the law of a different EU Member State or an EEA country.
  • The German federal government issued a draft bill that would amend the real estate transfer tax law, and that would in effect enhance the significance of the tax for companies.

Read a September 2019 report [PDF 341 KB] prepared by the KPMG member firm in Germany

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