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Applications related to exchanges of shares under section 21 of the German Reorganisation Tax Act

BFH-Insights

Exchanging shares under section 21 of the Reorganisation Tax  Act [Umwandlungssteuergesetz–UmwStG] allows a group of companies to be rapidly restructured: shares conferring a controlling interest in one corporation are contributed to another corporation in exchange for the issuance of new shares. If an application is made, the exchange can be valued below fair market value, e.g., at the carrying amount. What’s more, under section 8b(2) of the Corporate Income Tax Act [Körperschaftsteuergesetz–KStG] there is no blocked period for groups in which all the entities are corporations.

Dr Martin Weiss
| 7 min read | 21 Apr 2026

Subsequent contributions to loss carryforward under section 15a of the Income Tax Act

BFH-Insights

In the case of partners in a partnership with limited liability, the transparent taxation under section 15(1) sentence 1 no. 2 of the Income Tax Act is restricted in loss situations. The limited partner may offset and deduct his losses directly only to the extent that he also bears them economically (section 15a(1) of the Income Tax Act [Einkommensteuergesetz–EStG]). Otherwise, pursuant to section 15a(2) of the Income Tax Act, the loss is merely assessed as offsettable [verrechenbar]. In that case, it reduces exclusively future profits from the interest in that specific limited partnership. The Federal Fiscal Court [Bundesfinanzhof–BFH] has now issued a detailed opinion on the special features of paragraph 1a of section 15a of the Income Tax Act, in particular regarding its constitutional assessment (file ref. IV R 27/23).

Dr Martin Weiss
| 6 min read | 21 Apr 2026

The passive loss of the German right to tax (“Entstrickung”) of assets

BFH-Insights

A “withdrawal” (Sect. 4(1) sent. 2 of the Income Tax Act) of business assets generally leads to the realization of hidden reserves. However, this requires the taxpayer to perform an act of withdrawal. Sect. 4(1) sent. 3 and 4 of the Income Tax Act creates a fictitious withdrawal if German taxation rights are excluded or limited. The Federal Tax Court (file numbers I R 41/22, I R 6/23) - in agreement with the tax authorities - considers the elements of the legal rule regarding the loss of the German right to tax to be fulfilled even if this impairment of the right to tax is not triggered by the taxpayer, but by a change in the legal framework (“passive loss of the German right to tax (“Entstrickung”)”).

Dr Martin Weiss
| 7 min read | 14 Apr 2026

Berlin-Brandenburg Tax Court clarifies that US withholding tax can be credited against trade tax

Corporate Tax Advisory Practice

Berlin-Brandenburg Tax Court clarifies that US withholding tax can be credited against trade tax

Sabine Najdecki
| 4 min read | 14 Apr 2026

Federal Court of Justice (BGH) amends case law – preliminary VAT returns and annual returns to count as separate offences

Federal Court of Justice (BGH) decision on VAT and criminal tax law

Businesses may face serious risks in criminal tax law after the Federal Court of Justice (BGH) ruled on 10 December 2025 (1 StR 387/25) to change its previous case law. Incorrect preliminary VAT returns and a related incorrect annual return no longer count as a single offence. Instead, the offences stand next to each other and are to be evaluated under criminal law separately. This results in a considerable tightening of the legal consequences to taxpayers and all those involved in the preparation and submission of preliminary VAT returns and annual returns.

Dr Nicole Hellberg
Katharina Lehner
Wiebke Werner
Hannes Zug
| 5 min read | 14 Apr 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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