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Since 2022 the “everlasting deferral” for exits from Germany has also been rescinded and not replaced for changes to residence within Europe. Businesspeople and natural persons with shares in corporations of more than one percent now have to pay exit tax straight away. Distributing this in instalments over seven years is only a little help with liquidity planning be-cause the tax authorities usually require the full amount to be paid up front as security. A Polish court has now referred three questions to the ECJ, which, with regard to the European law concerns, could also be relevant to Germans moving abroad.

Moving abroad may have tax consequences that are often underestimated. When moving to a tax haven or low-tax country, “extended non-resident tax liability” for income tax as well as inheritance and gift tax often goes unrecognised. This is why particular attention should be paid to a recent decision by the German Federal Fiscal Court (BFH). In this article, we shed light on what those moving abroad need to know about the German extended limited tax liability.

Exit taxation, often also called exit tax (Wegzugsbesteuerung or Wegzugsteuer), is a central topic in German tax law and is becoming increasingly important in the context of international mobility.

In this article, you can read about the challenges that arise when preparing a purchase price allocation.

The court clarifies that that a temporary absence and the associated annulment of exit taxation also applies if there was no intention to return at the time of leaving Germany. What this means in practice.