Enacted Laws

• A review of the legislation of 2025, with a particular focus on legislative changes that took effect in 2026.
• Second Act to Strengthen Occupational Pensions of January 16, 2026
• Regional Development Act – StoFöG dated February 4, 2026
  • Improving financing conditions for businesses.
  • Facilitating venture capital investments.
• Electric Car Incentive Program‍
• Pension Reform Act
  • Improving private retirement savings (“Riester” pensions).
  • Introduction of a retirement savings account for children (known as the “Early Start Pension”).
• Ninth Act Amending the Tax Consultation Act and Other Tax Provisions
  • Relief Bonus, Minimum Trade Tax Rate, and Real Estate Transfer Tax – Signing and Closing, Joint Ownership Presumption.
• Act Implementing the CSRD Directive
  • Omnibus Relief Package: Reduction of reporting requirements; postponement of sustainability reporting.
• Act Amending the Supply Chain Due Diligence Act.

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Implementation of any guidelines issued by the Federal Constitutional Court (BVerfG)

• Constitutionality of the inheritance tax exemption provisions.
• Constitutionality of the Amount of Interest on Suspended and Deferred Payments.
• Constitutionality of the loss carryforward rule in the event of a change in ownership exceeding 50%.
• Constitutionality of the restriction on offsetting losses from the sale of shares.

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Other Reform Initiatives

Tax Law Changes Envisaged in the Coalition Agreement

• For businesses: Corporate income tax liability for all newly established companies; self-assessment of taxes for corporations and partnerships; mandatory use of cash registers above a certain revenue threshold; and combating sham transfers of registered offices to so-called trade tax havens.
• For employees: Combining the commuting allowance and the work-from-home allowance into a single workday allowance.‍
• For families: Aligning the tax relief provided by child benefits and child tax credits, introducing a child benefit that does not require an application, and providing tax relief for single parents (spousal/family tax splitting).‍
• In addition: tax deductions for energy-efficient building renovations, reduction of red tape.

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• Digitization and automation of business processes.
• Statements from the Federal Chamber of Tax Advisors on GoBD and e-invoicing
• E-Invoicing and Reporting Requirements in Accounting
• E-Balance Sheet – Current Developments, Practical Implementation, Taxonomies 6.9 and 6.10, FAQs, Requirement for Atypical Still to File an E-Balance Sheet
• VAT in the Digital Age

‍Current Case Law and Statements

• Intangible (Digital) Assets on the commercial and tax balance sheets
  • Costs of Customizing in Light of the EU Data Act.
• Properties
  • including, among other things, subsequent construction costs resulting from expansion and substantial improvements (IDW vs. BMF).
  • Maintenance costs associated with repairs and modernization.
• Economic ownership in the case of a contribution "quoad sortem."
• The co-owner’s shares in the GmbH as Special Business Assets II.
• Excessive acquisition costs as a hidden dividend.
• Mixed Donation
  • Transfer for partial consideration (strict or modified separation theory).
• Accrual Principle / Accrual Accounting
  • Maintenance Reserve under the WEG.
  • Recognition of claims arising from a decommissioning obligation.
  • Signing fees and the provision of a sales guarantee.
• Company Car Taxation: Commuting Between Home and the Workplace.
• Accounting for Treasury Stock: Hidden Profit Distributions and Equity-Based Compensation.
• Non-deductible business expenses
  • Early repayment penalty in connection with the sale of real estate
  • Voluntary payments to local residents, given as gifts to increase acceptance of a wind turbine.
  • Interest on Back Payments and Refunds for Corporate Income Tax and Trade Tax

Latest News on Provisions and Liabilities

• Provisions for contractual and public-law obligations.
• Early retirement plan, pension provisions, discounting in the financial and tax balance sheets.

Value added tax

• E-invoice.
• VAT in the Digital Age:E-Invoicingat the European Level.
• Cross-Border Deliveries
• Distinction between single-purpose and multi-purpose gift certificates.
• Allocation Rule for Hotel Stays.
• Tax Group – Non-Taxability of Intra-Group Transactions Related to Non-Economic Activities in the Strict Sense
• Change in the balance of use between business operations and non-economic activities in the strict sense
• Providing a vehicle to an employee for personal use as a transaction analogous to a barter.
• Pass-through acquisition in the case of a sale of an entire business.
• Input Tax Refund Through Tax Assessment.
• Retroactive Effect of Invoices: Input Tax Deduction Upon Provision of Services.

Wage tax

• Taxation of ongoing income from an employee stock ownership plan.
• Sale of Shares and Continuation of Management Duties.
• Prima facie evidence of personal use of a company car despite a prohibition on such use (vGA).
• Business trips using a personal car when the company car is used exclusively for personal purposes.
• Entitlement to vacation pay as compensation for several years of service.
• Tax Reduction on Lump-Sum Payments of Benefits from an Employer-Sponsored Pension Plan.
• Employer's Responsibility for Severance Pay.
• Retroactive collection of the flat-rate payroll tax through a notice of additional assessment or a liability notice.

Trade tax

• Changes toadditionsanddeductions:Rental of conference rooms and logistics space.
• Extended property reduction, Secondary employment that does or does not affect benefits.
  • Business Spin-off
  • Subleasing of freight elevators and high-rise racking in a warehouse.

Corporate Income Tax, Including International Income

• Group of Companies
  • Actual Implementation of a Profit-Transfer Agreement.
  • Deductibility of the disposal costs incurred by the parent company in connection with the sale of a sub-subsidiary.
• Hidden Profit Distributions and concealed inserts
  • Lump-sum payment in lieu of a pension benefit.
  • Hidden Capital Contribution in the Event of a Reduction in Income at the Shareholder Level.

Corporate Income Tax

• Shareholders and partners in a partnership:
  • Tax Implications of New Federal Fiscal Court (BFH) Case Law.
• Withholding Tax:
  • Capital gains from an interest-free deferral of the purchase price.
  • Waiver of a claim in exchange for a debenture.
• Sales of Shares Under Section 17 of the Income Tax Act (EStG):
  • Losses on liquidation resulting from an allocation to capital reserves for the purpose of debt repayment (cash circle).
  • Redemption, for consideration, of a usufruct right in a GmbH share.
  • Appreciation in the value of shares in a corporation treated as a gift.