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Press Releases from Lawyer Alexander von Engelhardt (25 total)

Income Accrual to Salary Conversion for Early Retirement

Are payments into an account in the form of credit to finance early retirement considered receiving payment of a salary, and thus subject to taxation? Does this also apply to external directors? The Federal Finance Court answered this question with its judgment of February 22, 2018 (re: VI R 17/16). To find out more on this topic and other related articles, please visit my website: http://www.vonengelhardt.com/en/german-legal-news/private-tax-news/849-income-accrual-to-salary-conversion-for-early-retirement About Alexander von Engelhardt Alexander von Engelhardt is

May Tax Offices Collect 6% Interest for Late Payments

The 0% interest policy of the European Central Bank and German tax offices can still demand 6% default interest for late payments. How can this be? Is that not a crying injustice? The authorities collect 6% interest and all tax payers are punished when they save money in bank accounts with, for example, -1% interest. The Federal Fiscal Court ruled on this matter on November 09, 2017 (re III R

Speculation Tax when Selling Self-Used Home

Is the surplus of the sales price over the costs for a self-used condominium subject to “speculation tax”? Speculation tax is the colloquial name of the income tax burden accrued when selling real estate inside the speculation period of ten years after purchase (§23 I 1 no. 1 EStG). The tax Court in Cologne ruled on this question with judgment of March 20, 2018 (re 8 K 1160/15). To find out

Brexit and Immigration Germany - 2nd UPDATE

The people's voice in majority said "out". So be it; this is nothing but a democratic decision. It is also normal, that people cry out loud if their opinion is not followed. How will this effect Brits in Germany right now? Will they be kicked out? May they stay? I want to briefly discuss the legal consequences for immigration of the BREXIT – shortly before the "divorce" is final. What

Input Tax for Companies with Virtual Offices

For ages, international investors were troubled with input tax doubts from their local tax office because the office did not want to accept companies having only a virtual office. Complaints have reached the German Federal Fiscal Court. Since these German judges were not sure whether German law was in conflict with European law, they presented their questions to the European Court of Justice to decide them. This article will briefly

Ground Rules for Bargain Hunters around the Holidays Season

Christmas and Chanukah are coming closer every minute. Many of you will surely be hunting for presents up to the very last second. What precautions can you take when you wish to exchange the goodies because your child might not like the toy you chose for her? What if the item turns out to be defective? What if…? To find out more about how to exchange items and what to do

Short-term Cancellations for Christmas Party – Burden for Celebrating Colleagu …

Sometimes colleagues can spoil one’s day, this can be even more bitter when fellow workers do not show up on short notice for company events (here: Christmas party). In this case, the tax office wanted to assess taxes based only on those who came and not also those who belonged to the company. The Fiscal Court Cologne decided this dispute with its judgment of June 27, 2018 (re 3 K

Legal Hints for Christmas Shopping

As Christmas time is coming, so is the unwrapping on Xmas Day as well. Cope with the fact, that many Germans will shake their heads in pity that you, though you consider it to be normal, always present the gifts one day too late… Germans not only give to their kids on Christmas Eve but also do not place them in stockings by the fireplace. But that is not really

Temporary Work Permit

While recruiting, i.e. matchmaking between employer and employee, is not subject to restrictions, temporary work employers needs to apply for a permit (§1 I 1AÜG). Until your company has this permission, it is fully permissible to provide recruiting services. When operating prior to having received permission, be very sure that you are not engaging in temporary work. Authorities are very cautious about illegal temporary work and will often conduct spontaneous inspections

Tiny Candle – Great Damages – No Liability

In these dark days of winter, candle light raises spirits and with a good red wine and the right company… This will come to an abrupt end, when a tiny flame ignites a huge fire. The mere fact of igniting a flame does not necessarily end in liability. This article will introduce the decision of LG Coburg of June 30, 2008 (re 13 O 714/07) concerning liability for setting fires. To

Brexit and Immigration Germany - UPDATE

The people's voice in majority said "out". So be it; this is nothing but a democratic decision. It is also normal, that people cry out loud if their opinion is not followed. How will this effect Brits in Germany right now? Will they be kicked out? May they stay? I want to briefly discuss the legal consequences for immigration of the BREXIT -- after the "divorce" has been filed. What

Defense Against Denial of Input Tax During Audit

This article is less about a single precedent and more a practical hint for businesspersons on how to effectively defend yourself when, during an audit, the tax office starts denying VAT deductions. Everybody would assume that auditors would keep a sense of proportion when checking the books and not pick on only formally incorrect payables. Even more so since ECJ had decided on September 15, 2016 (re C-518/14) that incorrect invoices

Salary in Money ./. Salary in Kind

The question whether a pecuniary reward is a payment in kind or a payment in money is relevant to §8 II cl. 11 EStG. This directly relates to whether a payment can be tax exempt or not. In the case 13/16, an employer took out a supplementary health insurance for the benefit of the employee, while in the case of 16/17, the employer only organized an insurance which the employees

Are Startup Grants from EXIST-Program Business Income?

FG Münster had to decide a dispute between the tax office and a startup on April 13, 2018 (re 14 K 3906/14 F). The greedy tax office wanted to classify a grant as taxable income while the founders were not at all amused by a gift being taxed. To find out how the court ruled, please read my article: http://www.vonengelhardt.com/en/german-legal-news/business-tax-news-miscellanious/833-are-startup-grants-from-exist-program-business-income About Alexander von Engelhardt Alexander von Engelhardt is a lawyer specializing in German immigration

Drug Trafficker no Entry in spite of Daughter in Germany

Is it a violation of human rights when a drug trafficker is refused a residence permit in Germany? The European Court of Justice clarified the denial of a Nigerian’s application to live in Germany with its decision on March 1, 2018 (re 58681/12). To find out how the court ruled, please read my article: http://www.vonengelhardt.com/en/german-legal-news/foreigners-law-news-residency/823-drug-trafficker-no-entry-in-spite-of-daughter-in-germany About Alexander von Engelhardt Alexander von Engelhardt is a lawyer specializing in German immigration and corporation law. He has

Co-heir Means Co-debtor in Taxation – Even if Unaware

The Federal Tax Court had to decide on August 29, 2017 (re VIII R 32/15) on a dispute among heirs of a large estate where everyone played a different role when it came to avoiding / creating tax liabilities. Joint Heirs Receiving an Estate not Knowing the Contents The beneficiaries of an estate not only receive all claims and liabilities per civil law but also inherit the tax status of the bequeathed.

EU States Responsible for Protection Against Deportation for Citizens of Other M …

An Italian complained to the ECJ that Germany incorrectly extradited him to the United States. The ECJ decided this case in its judgment of April 10, 2018 (re C-191/16). The question before the court was whether a Member State must provide protection against extradition to citizens of other member states . To find out how the court ruled, please read my article: http://www.vonengelhardt.com/en/german-legal-news/foreigners-law-news-residency/802-eu-states-responsible-for-protection-against-deportation-for-citizens-of-other-member-states About Alexander von Engelhardt Alexander von Engelhardt is a

Permanent Residency in Spite of Debts

Can an applicant be eligible for permanent residency when he has serious debts and is paying them off as agreed? VG Berlin decided this dispute between immigration in Berlin and an applicant on January 26, 2018. To find out how the court ruled, please read my article: http://www.vonengelhardt.com/en/german-legal-news/foreigners-law-news-residency/797-permanent-residency-in-spite-of-debts About Alexander von Engelhardt Alexander von Engelhardt is a lawyer specializing in German immigration and corporation law. He has dual citizenship (German and American) and was

Minor Can Loose German Citizenship Due to Sham Parentage

Can a toddler lose his or her German nationality without fault just because its mother could not make up her mind who the father was? BVerwG answered this question on April 19, 2018 (re BVerwG 1 C 1.17). The plaintiff, born 2004 in Germany, sought acknowledgment that she was German. Her Serbian mother was at that time in Germany without a residence title, having the legal status of a toleration (§60

Are Sick Payments for Housekeepers Subject to Progression in Taxation?

The BFH decided on June 17, 2005 (published on September 7, 2005) on the question VI R 109/00 if the received household benefits from your health insurance company following an accident are subject to taxation. To find out how the court ruled, please read my article: http://www.vonengelhardt.com/en/german-legal-news/49-private-tax-news-on-deductibles/504-are-sick-payments-for-house-keepers-subject-to-progression-in-taxation About Alexander von Engelhardt Alexander von Engelhardt is a lawyer specializing in German immigration and corporation law. He has dual citizenship (German and American) and was born

Deductibility of Self-Paid Health Costs as Insurance Costs

The privately insured tax payer Tommy came up with a witty idea. His health insurance offered him to reimburse him with a certain amount of his premiums if he would bear some health costs out of his own purse. Tommy liked that idea to spare himself costs. On the other hand, he felt that these expenses were like paying health insurance premiums in kind. He declared these costs as health

Home Office – Which Spouse can Deduct?

Is it possible for two tax payers living together to share not only an apartment and not only the joint home office but also deduct these costs from their income to save taxes? Jack works as an employee and next to this work, he serves on call for the district's office for psychologically ill persons. He receives overtime benefits and is reimbursed for his traveling costs. He and his female mate

Loans Amongst Close Relatives

Trusting family members is as normal as can be. Therefore, it is usual that dealing with them is not as formal as it would be among strangers. But what happens when you miss a required formality in tax matters? Can you still make a deduction? The BFH gave its input to this question with its judgment of May 12, 2009 (re IX R 46/08). In my new article I provide answers

Parental Benefits (Elterngeld) Reduces Private Deductibles

Paying alimony and support can be conceptually deducted as extra ordinary expenses. As the law determines, the deductible amount of alimony and / or support will be reduced by the amount the beneficiary earns. Does the received Elterngeld count as income in this regard? The tax court of Münster / Westpfahlen had to answer that question with its judgment of November 16, 2015 (re 3 K 3546/14 E). In my

D&O Coverage for Incorrect Payments During Bankruptcy

Berlin 09.10.2018 A D&O insurance policy covers the risk for financial damages for the insured director or executive staff member. Does it also cover damages for a director’s incorrect payment during bankruptcy? The Higher Regional Court Düsseldorf answered this question on July 20, 2018 (re I-4 U 93/16). In my new article I provide indepth information on this topic. To find out more please visit my website: ww.vonengelhardt.com/en/german-legal-news/business-law-news-miscellaneous/824-d-o-coverage-for-incorrect-payments-during-bankruptcy About Alexander von

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