Overcoming boundaries.
Without stumbling on taxes.

International – Whether a foreign entrepreneur on the domestic market or a domestic entrepreneur abroad: your company’s involvement in a different country has many facets. Whether conducting direct transactions, through a permanent establishment or a subsidiary – we understand the requirements and pitfalls that come with a company operating internationally. From planning to foundation and closure, we help you find the ideal means of organising your company’s expansion at home and abroad. Aside from advising you on how to go about this, our service includes carrying out notification requirements, organising and handling your accounting system, and also preparing all of the domestic tax returns. With entrepreneurship come challenges – from direct transactions to permanent establishments and subsidiaries. We help you through every stage of your expansion – from the initial planning through to the operational implementation – and ensure that your international activities proceed smoothly.

Inheritance and gifts frequently come with an international element: this is true not only where the testator or heir is based abroad but also where they are both resident taxpayers and foreign assets are involved. Where such a configuration occurs, several countries periodically lay their claim to inheritance and/or gift tax. An extensive network of double-taxation agreements for inheritance and gifts does not exist A cross-border transfer of shares in a joint-stock company or of business assets can additionally incur a so-called separation tax under income tax law. Against this backdrop, the tax-efficient transfer of assets calls for specific tax planning. We advise you on the tax implications related to international inheritances or gifts, including the structuring and avoidance of double taxation as well as the appraisal and preparation of the required tax returns.

Double taxation agreements (DTAs) are international treaties through which countries prevent the same taxable person from incurring multiple identical tax levies on the same income for the same period of time. The Federal Republic of Germany maintains such agreements with some 100 countries, through which tax relief claims for taxable persons can typically be derived. However, as positive as this may sound, it frequently turns out to be a complex affair in practice. Conflicts of qualification and attribution, supplementary protocols, obligations to report and subject-to-tax clauses quickly engender complex tax-related issues. We advise you on every situation by preparing expert reports, help you prepare tax returns correctly and safeguard your legal interests in Germany.

Any (potential, including gradual) relocation abroad can have far-reaching tax implications. Contrary to the widely shared view, this holds true not only for taxable persons holding shares in joint-stock companies amounting to at least one percent of their private assets, which are subject to so-called exit tax pursuant to Section 6 of Germany’s Foreign Tax Act (AStG). Moving to a different country can also trigger tax implications for sole proprietors (e.g. influencers), partnerships or managing directors of joint-stock companies. What all of these cases have in common is that they will result in a so-called Abschlussbesteuerung domestically, i.e. the still reserves shown in the relevant assets will be subject to a fictitious capital gains tax. A particularly complex issue here is the definition of tax emigration, which may arise as a mere consequence of a legislative amendment (known as passive separation) or also gradually (transfer of residence). Tax advice from an early stage in the emigration process not only frequently enables risks to be detected and averted but, in many cases, can also result in taxation options that may lead to significant tax relief. We would be glad to assist you on this.

Where cross-border relocation is concerned, the focus of any tax advice is periodically placed on the country of departure. Taxation regulations in effect in the country of destination is a matter that taxable persons often only concern themselves with after their arrival. Tax organisation options frequently go unused as a result, especially in cases where individuals “are carrying” assets with high increases in value. Receiving expert advice in advance is especially important in this context. We help you to make full use of existing taxation options before you immigrate so that you can limit your domestic taxation to what is absolutely necessary.

Where domestic employees work for a foreign employer or for a domestic employer abroad (even if only part of the time), from home, for example, as part of a secondment programme or a so-called “workcation” arrangement a variety of tax issues arise: which state has the right of taxation? How can double taxation be avoided? How are wages split? What pay-as-you-earn obligations exist? What returns need to be submitted? Do social insurance contributions have to be paid at home or abroad? We advise you on every aspect of the cross-border employer-employee relationship.

Anyone drawing a German pension may well be subject to German income tax, regardless of their place of residence. Pensioners resident in Germany who receive retirement income from abroad are frequently also liable to pay taxes. We are highly specialised in the tax treatment of payments derived from foreign pension models, e.g. US 401(k) plans.

Whether a domestic owner of a property abroad or a foreign owner of domestic real estate: knowing the ins and outs of the tax law practice in the state where the property is located is essential. We advise you on the tax implications of renting or selling, including with regard to the special arrangements for real estate that are frequently contained in double taxation agreements.

Whether a holding company or a private or family foundation: when structuring assets, the question arises as to what tax implications arise based on the chosen structure. This is not only of significance in the context of profit tax but also inheritance and gift tax and, beyond this, also in the context of asset protection. We identify the tax implications, risks and advantages of international holding or foundation structures and assist you in their implementation.

Establishing foreign joint-stock companies is part and parcel of the standard repertoire of an international business operation or activity. In these cases, however, taxes are not always only levied on profits in the company’s foreign country of residence. Under the CFC rules, income derived at a foreign subsidiary is taxed in the domestic shareholder’s country of residence. This is intended to prevent foreign income being carried over to a taxable company based in a low-tax jurisdiction and not subject to domestic taxation, thus acquiring tax benefits. Ultimately, this leads to immediate taxation of the domestic shareholders. We advise you on the complex regulations, identify risks and present tax organisation options.

Where cross-border business operations or activities are concerned, the issue arises as to how the tax base should be split between persons known to be close associates. In such cases, observance of the arm’s length principle is the decisive factor – that is to say, from the point of view of all countries involved. One particular aspect of transfer pricing is the matter of how relocations of functions are taxed when a cross-border restructuring of the business operations occurs. We guide you through the tax risk analysis and help you comply with the arm’s length principle in an international context.

Withholding tax plays an essential role for cross-border payments. Here, the state draws on the contracting partner of the taxable person, who is typically resident in that country, and requires this partner to withhold and pay the tax upfront. The payee only receives the after-tax amount. The international withholding tax not only leads to potential liquidity costs but also carries the risk of double taxation as well as incurring liability in respect of claims. We advise you on the options available for reducing or avoiding withholding tax deductions, on the possibility of offsetting foreign withholding tax on the home market, or handle the reporting of withholding tax on your behalf.