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Withholding Tax Health Check – identifying risks and checking processes

HEALTH CHECK PART 9

As a rule, licensing and use of rights agreements abroad trigger withholding tax liability – and it’s right here that considerable risks arise in practice. This is how tax deduction in accordance with section 50a of the Income Tax Act [Einkommensteuergesetz–EStG] is often overlooked or misapplied and inadequately formulated in the underlying contracts – with consequences of liability to match for the licensee in Germany. A Withholding Tax Health Check helps, firstly, to identify these kinds of issues, to check processes and responsibilities and to close the interface between the specialist departments and the tax department – before a tax audit does.

| 9 min read | 21 Jul 2026

Federal Fiscal Court ruling: Deduction entitlements under section 10f of the Income Tax Act cannot be inherited

BFH-Insights

When it comes to income tax, the death of a taxpayer marks a break that, while it does not interrupt the assessment period (section 25(1) of the Income Tax Act [Einkommensteuergesetz–EStG]), does raise numerous other questions. In special provisions such as section 6(3) of the Act and section 11d(1) of the Income Tax Implementation Directive [Einkommensteuerdurchführungsverordnung–EStDV], the legislature has clarified specific issues in this area, just as section 45 of the Fiscal Code [Abgabenordnung–AO] partially resolves procedural issues. However, deductions — such as loss carryforwards under section 10d of the Income Tax Act — do not pass to heirs who are universal successors (section 1922(1) of the Civil Code [Bürgerliches Gesetzbuch–BGB]). The tenth chamber of the Federal Fiscal Court [Bundesfinanzhof–BFH] has now ruled along the same lines regarding the “quasi-special expenses” under section 10f of the Income Tax Act (“Tax relief for listed historic buildings and buildings in redevelopment areas and urban development zones used as residences”; file ref. X R 23/24).

Dr Martin Weiss

| 8 min read | 20 Jul 2026

Federal Fiscal Court ruling: Prohibition on deducting loan losses under section 8b(3) sentence 4 and following of the Corporate Income Tax Act

BFH-Insights

Trade tax liability under section 2(1) of the Trade Tax Act [Gewerbesteuergesetz–GewStG] is substantively linked to business activity under section 15(2) of the Income Tax Act [Einkommensteuergesetz–EStG]. However, there are differences in the timing between income tax and trade tax. Trade tax liability under section 2(1) of the Trade Tax Act only arises once all the conditions that constitute business activity have been met and the business activity has been started. Income tax, on the other hand, covers all business activities starting from the first preparatory step to open a business. With regard to notional business activities (section 15(3) of the Income Tax Act), which also give rise to a trade tax liability, the Federal Fiscal Court [Bundesfinanzhof–BFH] has again now ruled on this issue (file ref. IV R 5/24).

Dr Martin Weiss

| 7 min read | 15 Jul 2026

Corporate fitness and prevention courses: new requirements for proving tax exemption

Wage tax & benefits

Corporate fitness programmes are an established way of retaining staff and promoting their health. In terms of tax, employers and employees particularly benefit when preventive activities fulfil the criteria of section 3 no. 34 of the Income Tax Act [Einkommensteuergesetz – EStG] and so can be offered tax-free.

| 6 min read | 10 Jul 2026

Payroll Health Check – how to set up your payroll for the future

Helath Check Part 10

A Payroll Health Check is a systematic review and assessment of your company’s payroll accounting. The goal is to identify risks, correct errors and set up payroll to be fit for the future. We take an allround approach with the motto “prevention, not reaction”. We place our main focus on practically carrying out your internal policies and remuneration models in operational payroll. The result is a risk assessment that includes recommendations for action and, if needed, support for your payroll department with making corrected returns and a review of historical payroll periods.

| 7 min read | 09 Jul 2026

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Press releases

Grant Thornton increases annual revenue to EUR 264 million in financial year 2024/25

11 Mar 2026

The audit and advisory firm Grant Thornton in Germany ended the 2024/25 financial year on September 30, 2025, with consolidated revenue of EUR 264 million (up 6 percent on the previous year). The Audit & Assurance division recorded particularly strong growth with an increase of 14 per cent compared to the previous year.

Grant Thornton Germany wins Martin Biegel for the new position of CFO/COO

09 Feb 2026

Martin Biegel joined the Senior Leadership Team of the audit and advisory firm Grant Thornton Germany in February as the new Chief Financial Officer/Chief Operating Officer (CFO/COO) and in this role will actively help drive the firm’s strategic development.

Grant Thornton Germany and Cinven enter into strategic partnership

13 Oct 2025

The Equity Partners of Grant Thornton AG Wirtschaftsprüfungsgesellschaft (“Grant Thornton Germany”) have approved the strategic partnership with international private equity firm Cinven. This marks a key milestone for the transaction initially announced on 10 September 2025, which is expected to close in the first quarter of 2026. The partnership further strengthens Grant Thornton Germany’s position as a leading, trusted service provider in the German audit and advisory market, ushering in its next phase of growth.

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