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Source: BUS Sachsen-Anhalt (Linie6PLus)

Applying for a Separate Determination on the Return of Capital Contributions for Tax Purposes in Accordance with the German Corporation Tax Act (Körperschaftsteuergesetz)

Description

Foreign companies are generally not required to maintain a taxable deposit account. However, corporations and associations of persons from EU/EEA member states with domestic shareholders may apply for a separate determination of a non-taxable return of contributions.

The object of the determination is all payments made by the applicant from its fictitious taxable contribution account.

When filing the application, not only the contributions and benefits of domestic shareholders must be stated, but in principle all contributions and benefits. The obligation to provide evidence starts from the time when contributions were made, the repayment of which is claimed.

The application must be submitted in writing on an officially prescribed form to the tax authority that is locally responsible for taxing the applicant's income at the time the application is submitted. If no tax authority has local jurisdiction at the time the application is filed, the application must be submitted to the Federal Central Tax Office (BZSt).

Important notice:
Foreign investment funds that make payments to their domestic shareholders in accordance with Sections 16 and 34 of the Investment Tax Act 2018 (InvStG) can no longer apply for the separate determination of a tax return of contributions in accordance with the Corporate Income Tax Act as of the 2018 assessment period.

Applications for the return of contributions for tax purposes may be submitted by:

  • foreign
    • Corporations or
    • associations of persons
  • from another Member State of the European Union or a State of the European Economic Area (EEA), who are resident in the other State
    • are subject to unlimited tax liability and
    • can grant benefits within the meaning of Section 20 (1) No. 1 or 9 of the German Income Tax Act (EStG)

can grant

When applying for the return of deposits, you must submit:

  • Certificate from the foreign tax authority stating that the applicant has unlimited tax liability for the period applied for
  • Information on the applicant's limited corporate tax liability in Germany, naming assets and activities in Germany, for examination by the competent authority in accordance with Section 27 (8) sentences 5 and 6 of the German Corporate Income Tax Act (KStG)
  • current excerpt from the commercial register
  • a company overview showing how the individual companies came into being and how they are connected with each other: the overview must show how long the individual companies have existed (for example, in the form of an organizational chart)
  • the amount of the share held by the domestic shareholder
  • if applicable, power of representation according to § 80 of the German Fiscal Code (AO) and power of receipt
  • own development of the various components of equity from the time when contributions were made, the repayment of which is claimed, at the earliest since 1.1.1977
  • a determination of the return of contributions
  • annual financial statements with reconciliation statements to German tax law in analogous application of § 60 of the Income Tax Implementing Regulation (EStDV) from the period in which contributions were made whose repayment is claimed, at the earliest since January 1, 2006
  • Resolutions and evidence of the actual implementation of
    • Contributions, the repayment of which is claimed, at the earliest since 1.1.1977
    • Benefits for the requested assessment period
    • Changes in the nominal capital from the period from which contributions were made, the repayment of which is claimed, at the earliest since 1.1.1977
    • Conversions as of the period from which contributions were made, the repayment of which is claimed, no earlier than 1/1/1977

Notes :

  • You must prove the amount and actual execution of cash contributions and cash benefits by submitting bank statements (bank records showing the payer and payee).
  • In the case of contributions in kind and contributions in kind, you must provide evidence by submitting contractual documents (for example, transfer, loan or merger agreement) and accounting records.
  • To determine the value of contributions in kind (shares, receivables or other assets), you must provide evidence, for example in the form of a valuation report.
  • Contributions and benefits that have not been proven cannot be taken into account.

Application: by 31.12. of the calendar year following the calendar year in which the service was provided

for processing the application: approximately 16 months upon submission of complete documentation

  • Appeal
  • Tax court action
  • Forms: yes
  • Online procedure possible: no
  • Written form required: yes (signed application)
  • Personal appearance: no

You must submit the application for separate determination of a tax return of capital contributions in writing using the officially prescribed form to the locally competent tax authority or to the Federal Central Tax Office (Bundeszentralamt für Steuern, BZSt).

Variant 1: You must submit the application in writing to the tax authority that is locally responsible for taxing the income at the time the application is submitted.
Variant 2: If no tax authority is responsible at the time of application, you must submit the application in writing to the Federal Central Tax Office (BZSt).

  • Download the application form from the Online Form Management System (FMS) of the Federal Tax Administration (BFINV) and fill it out.
  • Print out the completed application form. The application form must then be returned by
    • signed by a legal representative of the company or
    • his authorized representative.
  • Send the signed application form together with the other required documents by mail to
    • your local tax authority (variant 1 ) or
    • the office of the Federal Central Tax Office (BZSt) in Berlin (variant 2 ).
  • The locally competent tax authority (variant 1 ) or the BZSt (variant 2 ) will check your application. You may have to answer further questions or submit additional documents.
  • If your application is approved, we will send you
    • the competent local tax authority (variant 1 ) or
    • the Federal Central Tax Office (variant 2 )

a notice on the separate determination of tax bases pursuant to Sec. 27 (8) Sentence 3 KStG by mail to the address specified in the application form.

  • In case of rejection, you will receive a rejection notice by mail.

Federal Ministry of Finance (BMF)

No authority found