26. Aug 15

EU planning tax reforms

The European Union wants to change its tax policy. One of its aims is for businesses in future to pay tax on their profits in the state in which they are generated.

GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London - www.grprainer.com/en conclude: There are different systems of taxation in the countries within the European Union (EU). For businesses operating internationally, this means that they have to observe various different rules and laws. At the same time, the different tax systems also offer creative room for manoeuvre. Handelsblatt reported on June 16 that the EU now wishes to set up a “fair business tax regime” within the EU. A corresponding strategy document is available.

The EU’s aim is to prevent businesses from shifting their profits to tax havens within and outside of the EU. Accordingly, tax should in future be paid on profits in the country in which they are generated. Furthermore, the basis for assessing corporation tax shall also be standardised across Europe. Businesses that operate internationally are clearly going to have to brace themselves for changes, including with regard to tax structuring options.

In principle, it is not only businesses but also private individuals who have to be mindful of international tax regulations if they do not live in the country in which they work. In order to maintain an overview of things here and avoid potentially paying too much tax or unknowingly infringing tax laws, private taxpayers as well as businesses can turn to lawyers and tax advisors with a high degree of expertise in the field of international tax law. There are corresponding agreements between many countries that are designed to prevent undue double taxation of income.

The issue of double taxation looms particularly large if income is generated in multiple countries. Which country is allowed to collect the taxes in these instances is regulated by the double taxation treaties in most cases. These deal in particular with income tax, corporation tax, taxes on investment and fiscal codes.

In addition to matters pertaining to taxation, businesses that operate abroad must also bear in mind legal aspects. Ideally, they will receive advice on these issues from one set of experienced lawyers and tax advisors who trustingly work together and also cooperate with foreign law firms.

For more informations: http://www.grprainer.com/en/legal-advice/tax-law/international-tax-law.html

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