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This e-newsletter gives you an overview of international corporate tax developments being reported globally by KPMG member firms in the Europe and Africa regions between 1 April and 30 April 2013.

Albania European Union Lithuania Spain
Austria Finland Luxembourg Sweden
Belgium France Malta Switzerland
Croatia Germany The Netherlands Turkey
Czech Republic Hungary Norway Ukraine
Denmark Ireland Poland United Kingdom
Estonia Israel Serbia

For a full summary of global tax developments, visit kpmg.com/TaxNewsFlash.

To contact the Global International Corporate Tax Group email go-fmglobalict@kpmg.com.

  Tax area concerned Relevant date/case reference Description of measures and publication link
(Considerations in italic where necessary)
Albania
Tax legislation adopted and regulatory update Corporate income tax 1 January 2013 The Albanian Minister of Finance issued guidance which revises the estimated corporate tax payment rules, and affects the ability to carry forward tax losses when there is a change in ownership among other items.
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Austria
Tax legislation adopted and regulatory update Corporate income tax March 2013 The Austrian Ministry of Finance published revised corporate income tax guidelines effectively tightening the rules with respect to interest deductions in connection with ‘debt push-down models‘ and concerning tax loss carry forwards claimed by certain companies.
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Belgium
Tax legislation adopted and regulatory update Corporate income tax 21 August 2013-18 September 2013 Further to negotiations between the Institute for Accountants and Tax Consultants and the tax authorities, the deadlines for filing the corporate tax return for assessment year 2013 have been set at:
21 August 2013 for paper filing, and
18 September 2013 for electronic filing.
These deadlines apply for Belgian resident companies, non-resident companies, and non-profit legal entities having a financial year closing 31 December 2012.
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Administrative and case law Employment law 16 April 2013
Anton Las v. PSA Antwerp NV, C-202/11
The Court of Justice of the European Union issued a judgment finding that Belgian law requiring employers with an established place of business in Flanders to use the Dutch language exclusively in employment contracts to be a violation of EU law.
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Croatia
Other EU membership 1 July 2013 The European Commission, in its latest monitoring report on Croatia's preparations for joining the European Union, has concluded that Croatia will be ready to join the EU on 1 July 2013.
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Czech Republic
Tax legislation adopted and regulatory update VAT April 2013 Recent tax and indirect tax developments in the Czech Republic include:
the liability of the recipient of a supply for paying VAT when making payments to accounts other than those published in the payers’ register is postponed until 30 September 2013
the integrity of tax records and documents under the VAT law are to be determined so as to create a ‘reliable audit trail.’
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Real estate April 2013 Recent tax and indirect tax developments in the Czech Republic include:
legislation concerning the transfer tax with respect to real property acquisitions no longer would include shares/interests in corporations owning real estate
new rules provide that rights to land and buildings and other legal rights concerning real property, will also be deemed to be ‘real property.’
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Other April 2013 Recent tax and indirect tax developments in the Czech Republic include:
a carbon tax has been proposed to be effective from 2014
effective in 2014, entities that can provide support that they conduct public benefits activities may obtain public benefit status (provided appropriate documentation is available)
new income tax treaty with Luxembourg would replace the 22-year old treaty.
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Denmark
Other Corporate income tax/withholding tax 25 April 2013 The European Commission announced that in issuing a ‘reasoned opinion’, it has formally requested Denmark to change its rules on the taxation of dividends distributed to foreign ‘investment institutes with minimum taxation’.
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Estonia
Administrative and case law VAT 12 February 2013
Case 3-
3-1-75-12
The Supreme Court agreed with the opinion formed by lower courts that under circumstances where the buyer is unable to identify the seller who is the counterparty of the transaction in dispute, an unidentified third party has to be considered the actual seller who cannot be presumed to be liable to pay VAT. In this case, deduction of input-VAT by the buyer is not allowed. Also, under such circumstances, cumulative VAT (turnover tax) cannot arise since deduction of input-VAT is forbidden.
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European Union
Other VAT 30 June 2013 The deadline in most EU countries for a VAT reclaim for 2012 is set for 30 June 2013. For this reason, businesses with potential EU VAT claims may need to take steps soon because, in many EU countries, missing this deadline could lead to unrecoverable VAT.
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Custom duties 1 July 2013 Companies that import goods originating in Korea into the European Union, may be eligible to recover import (customs) duties under provisions of the EU-Korea free trade agreement. EU companies that imported goods ‘originating from Korea’ after 1 July 2011 and paid customs duties on these imports, have until 1 July 2013 to file a claim for retroactive refund of those customs duties.
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Car taxation April 2013 The EU reported there currently is little harmonization of tax provisions applied by the EU Member States with respect to passenger car taxation.
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Corporate and personal income tax/VAT/Other April 2013 The EU announced that the overall tax-to-GDP ratio has increased among the EU Member States, from 2011 to 2011 — up to 38.8 percent in the 27 EU Member States and up to 39.5 percent in the EA17.
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Proposed legislation Bank tax 1 January 2014 The European Parliament approved provisions that would amend the EU rules on financial institutions’ capital requirements, impose a cap on bankers’ bonus payments and require country-by-country reporting of tax payments by certain EU financial institutions.
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Finland
Tax legislation adopted and regulatory update Withholding tax 20 March 2013 Finland’s central tax board issued an advance ruling on 20 March 2013 providing that withholding tax does not apply with respect to dividend distributions from a Finnish company made to a Luxembourg Fonds Commun de Placement (FCP).
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France
Proposed legislation Corporate income tax April 2013 The French President announced a proposal that would impose a corporate-level tax at a rate of 75 percent on payments of salaries exceeding €1 million. Under this expected draft, the tax liability would now be imposed on and payable by companies/employers instead of on the individuals/employees on the portion of salaries that exceeds €1 million.
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Tax legislation adopted and regulatory update VAT February 2013 Revised VAT guidelines, which follow an October 2011 decision of the Conseil d’Etat, limit the possibility for taxpayers to treat some financial transactions as ‘incidental’ and reaffirm the tax authority’s position that the financial product must not be a direct, permanent, and necessary extension of the taxpayer’s activity to be disregarded for calculating the deductible portion of VAT.
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Withholding tax 1 January 2013 France has amended its law regarding the applicable limitations period for filing refund claims for tax. The standard three-year limitations period applies, and is no longer subject to extension, when a court (like the Court of Justice of the European Union) finds the French law provisions are incompatible with European Union law.
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Corporate income tax April 2013 The French tax authorities have published their comments concerning the 3 percent corporate income tax surcharge on distributions. In light of these comments, multinational entities need be aware of the potential effect of the 3 percent surcharge in various situations when a European company is involved.
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Administrative and case law VAT April 2013
Crédit Lyonnais (case C-388/11)
A case pending before the Court of Justice of the European Union concerns questions relating to the VAT input recovery ratio for companies with global operations.
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20 March 2013
DIAC
The French supreme tax court held that VAT was not required in connection with payments made by car lessees as ‘indemnities’ for early termination of an automobile lease. The high tax court’s decision, thus, may provide opportunities for auto-leasing company refunds of VAT with respect to certain auto-leasing agreements.
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Withholding tax April 2013 Cour d’appel de Paris, 9eme Chambre, No. 10PA00748 The Court of Appeal overturned a decision of a lower court and rejected the French tax authorities’ assessment of withholding tax in connection with a French buy-sell distributor’s conversion to a commissionaire of a UK entity.
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Germany
Tax legislation adopted and regulatory update VAT April 2013 The German finance ministry issued guidance on:
organization integration to qualify as a VAT group
distinction between supplies of goods and services in the supply of food and drink
change in the simplification rules for intra-community movement of goods to the business' own disposal - extension of transitional arrangement.
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Administrative and case law   Corporate income tax April 2013
I R 72/11
Germany’s federal tax court held that due-diligence expenses incurred by a German company with respect to a failed acquisition of a Swiss company are deductible business expenses.
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VAT April 2013 Recent judgments from the European Court of Justice and decisions from Germany’s federal tax court involve the following indirect tax/VAT issues:
tax exemption of advisory services for investments in securities supplied to an investment company
transfer of a business as a ‘going concern’ does not require the transferor to terminate its business activities
non-compete agreement as non-taxable turnover as part of a transfer of a business.
Transfer of a building right when a leased rehabilitation center had been constructed as a non-taxable transfer of a business.
Requirements for the justified rejection of an invoice in case of self-billing.
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Hungary
Tax legislation adopted and regulatory update Corporate income tax/personal income tax/VAT/customs duties 8 April 2013 A package of tax law provisions (reference number T/10238) approved by the Hungarian Parliament includes:
measures codifying the rules of international administrative cooperation
corporate income tax measures concerning support for team sports and sponsorship of performing arts organizations
Individual income tax measures concerning defining activities conducted by employees and changes to company car taxation
VAT modifications concerning the sale of automobiles
Excise tax (duty) changes affecting catering establishments
Financial transaction tax liability for cash payments made in post offices on ‘white cheque’ transactions.
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Ireland
Administrative and case law   VAT 9 April 2013 Commission v. Ireland, C-85/11 The Court of Justice of the European Union issued the first judgment in a number of infringement proceedings against EU Member States, and concluded that the inclusion of non-taxable persons in a VAT group does not violate the VAT Directive.
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Israel
Administrative and case law Indirect tax April 2013 -State of Israel - Israel Tax Authority - Department of Customs v. Hollis Industries Ltd. In a case concerning the classification of imports of ’raw materials‘ and ’manufactured goods’, the Israeli Supreme Court held that under certain circumstances, an Israeli distributor may be entitled to a customs duty refund for overpayment of tax on imports due to a customs misclassification.
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Lithuania
Tax legislation adopted and regulatory update Tax facts April 2013 Current tax developments in Lithuania include the following:
individual income tax returns and property declarations are due 2 May 2013. The list of taxpayers or entities required to file a property declaration has been expanded
there is a new annex concerning social insurance for self-employed individuals
individuals must decide on the method of pension funding and  inform their pension accumulation company by 1 September whether they elect to continue to pay additional contributions or to return to the state social insurance fund
new language has been added to the rules for tax loss carryforwards in situations of reorganization, transfer, restructuring, and liquidation
changes to the value added tax (VAT) rules concern invoices and concerning tourism services
changes to the excise tax/duty rates are effective 1 January 2013
There are new measures under the labor law provisions addressing employee terminations.
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Luxembourg
Proposed legislation Exchange of tax information 1 January 2015 Luxembourg’s Prime Minister announced an intention to introduce measures allowing for the automatic exchange of information for all interest payments made by Luxembourg financial operators to individuals residing in another EU Member State (within the scope of the 2003 EU Savings Directive).
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Malta
Other Economic performing forecast 2013 According to an EC report, the European Commission expects that in 2013 Malta  will be the second best performing country in the euro-zone.
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The Netherlands
Tax legislation adopted and regulatory update Pension plan 1 January 2013 – 31 December 2015 Long-awaited guidance establishes the conditions under which directors/major shareholders with a self-administered pension plan can waive part of their pension entitlements without incurring tax penalties. The guidance contains strict conditions that apply to pension entitlement waiver. In principle, conversion may only take place on the pension’s commencement date. However, a director/major shareholder whose pension commenced on 1 January 2013 has until 31 December 2015 to reach an agreement with the tax authorities.
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Corporate income tax 25 March 2013 New guidance concerning the amount of interest that can be deducted with respect to affiliated-entity debt has been issued, with an effective date of 25 March 2013. The new decree applies in respect of section 10a of the Dutch corporate income tax law. Section 10a limits the amount of interest that can be deducted in respect of debts with an ‘affiliated entity’.
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Corporate and personal income tax 1 January 2013 New rules relating to interest on tax assessments are effective as of 1 January 2013. Under the new rules, a provisional assessment must be timely requested (e.g. before the first day of the fifth month after the end of the tax period, or by 1 May), and the tax return must be timely filed (e.g. before the first day of the fourth month after the end of the tax period, or 1 April).
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Immigration policy 1 June 2013 New immigration rules in the Netherlands — effective 1 June 2013 — will affect the role and status of employers, in that they will now become the official sponsors for their immigrating employees under the Dutch immigration procedures.
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Administrative and case law VAT 1 January 2008 – 1 July 2011 The Dutch Supreme Court held that a lower VAT adjustment percentage is not to be imposed for ‘non-environmentally friendly’ company cars for periods prior to July 2011.
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VAT 25 April 2013
Commission v. Netherlands, C-480/10
The Court of Justice of the European Union held that non-taxable persons such as ‘top holdings’ can be part of a VAT group. With the judgment, it may be possible in some situations for the composition of the VAT group to be expanded and to be broader than was previously thought possible.
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Norway
Proposed legislation Company law/corporate income tax April 2013 Norway’s Ministry of Justice unveiled proposals to amend and simplify the Norwegian limited companies law and public limited companies law. The amendments to the laws would revise corporate governance rules, remove certain dividend constraints, and ease the ability for intra-group loans form Norwegian subsidiaries to foreign group companies.
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Corporate income tax 11 April 2013 The Norwegian Ministry of Finance announced a proposal to amend the tax rules governing interest deductions on intra-group loans. In line with recent developments in other European countries, Norway’s proposal would limit intra-group loan interest deductions for tax purposes and thereby reduce the tax planning opportunities for multinational groups.
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Poland
Tax legislation adopted and regulatory update VAT 1 April 2013 Under the second stage of amendments are the following provisions:
a new definition of ‘export of goods’ reflecting goods dispatched from Poland and transported outside the EU.
new rules regarding the supply of goods with VAT settled by the purchaser (a ‘reverse charge’ mechanism applies only if the supplier is not established in Poland or does not have a fixed place of business in Poland)
limitations on input VAT deductions
new rules concerning the free-of-charge supply of goods
an expanded definition of samples
a zero rate of VAT on intra-Community supplies of good
a definition of ’building lands’.
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Incentives 15 May 2013 - 5 June 2013 A round for grant applications under Poland’s program for investments with ‘high innovative potential’ opens 15 May 2013 and closes 5 June 2013.
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Serbia
Tax legislation adopted and regulatory update Rehabilitation program 8 April 2013 The National Assembly of the Republic of Serbia has adopted the Law on Amendments to the Law on Professional Rehabilitation and Employment of Persons with Disabilities.
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Spain
Administrative and case law Corporate income tax 25 April 2013
Commission v. Spain, C-64/11
The Court of Justice of the European Union concluded that the Spanish law that taxes unrealized capital gains on the transfer of the company’s place of residence or the assets of a company established in Spain to another EU Member State was contrary to EU law.
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Real estate 25 April 2013
IP/13/365
The European Commission announced that it has referred to the Court of Justice of the European Union the real estate tax provisions in Spanish law that provide tax benefits for individual residents who reinvest capital gains from the sale of a home, but prevent non-residents from enjoying the same tax benefits.
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Money laundering and terrorist financing 25 April 2013
Jyske Bank Gibraltar Ltd. v. Administración del Estado, C-212/11
The Court of Justice of the European Union issued a judgment concluding that EU law does not preclude a Spanish requirement that credit institutions operating (but not established) in Spain must forward information necessary to combat money laundering and terrorist financing directly to the Spanish authorities.
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Sweden
Proposed legislation Budget bill 15 April 2013 Sweden's government submitted to Parliament a budget bill that in general proposes domestic tax changes including measures that would:
amend rules that apply with respect to closely held corporations and generally bar taxpayers from converting progressively taxed individual income to capital gains (taxed at a lower rate).
simplify the regulatory framework relating to the tax liability for business premises rentals and allow an optional excise tax instead of the property owner issuing a rental invoice with VAT.
provide benefits for environmentally friendly company cars to be extended by three years.
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Administrative and case law VAT 25 April 2013
Commission v. Sweden, C-480/10
The Court of Justice of the European Union issued its judgment in a case concerning Swedish VAT grouping rules having implications for the financial and insurance sectors.
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Tax legislation adopted and regulatory update Corporate income tax March 2013 Sweden’s government has replied to the European Commission concerning an inquiry as to whether the Swedish interest deduction limitation rules are compatible with or violate EU law.
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Switzerland
Tax legislation adopted and regulatory update OECD report April 2013 The Organisation for Economic Co-operation and Development (OECD) issued an April 2013 report that explores the current Swiss system of taxation and includes recommendations to reduce what are described as distortive effects of the system.
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Turkey
Proposed legislation Corporate and  Personal income tax 24 April 2013 Proposed legislation would require companies and individuals to declare their unrecorded assets held outside Turkey. The measures (if enacted) would require taxpayers to declare the Turkish lira equivalence of cash, foreign currency, gold, securities, capital market instruments, and real estate owned and possessed outside Turkey.
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Ukraine
Tax legislation adopted and regulatory update VAT April 2013 Guidance letters from the Ukraine tax service concern the VAT treatment of:
equipment imported pursuant to operating lease agreements and entered into with a non-resident — as a temporary import for customs and tax purposes, such equipment — may be exempt from VAT
promotional materials distributed by advertising agencies to third-party consumers — costs of the distributed promotional materials — are included in advertising service fee and VAT is imposed on top of the service fee
motivational payments (including bonus payments) for achieving certain volumes of production/sales qualify as payments for marketing services and are to be invoiced with the VAT included
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Tax legislation adopted and regulatory update Corporate income tax April 2013 Recent tax developments in the Ukraine concern:
loan agreements having variable interest rates between residents and non-residents
substantial participation in a financial institution
amendments to the rules concerning bank transfer documents procedures, write-offs, and seizures of funds in foreign currencies and ‘bank metals’
new procedures for issuing general and individual licenses for currency transactions
new payment terms for settlements for cross-border transactions
draft law concerning the ‘financial pyramids prohibition’ in Ukraine.

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United Kingdom
Treaties Multilateral tax information exchange 9 April 2013 The UK today announced an agreement with France, Germany, Italy, and Spain to develop and pilot a multilateral tax information exchange process.
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Multilateral tax information exchange April 2013 Update on the agreement with France, Germany, Italy, and Spain to develop and pilot a multilateral tax information exchange process. The FATCA Intergovernmental Agreement (IGA) is apparently the template to be used, and tax professionals note that progress on the pilot could be relatively quick, given the work already completed on the IGAs.
Also, it is noted that the UK recently agreed to enter into automatic exchange of tax information agreements based on the IGA with Jersey, Guernsey, and the Isle of Man and is in discussion with ‘overseas territories’.
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Proposed legislation Finance bill April 2013 The UK Finance Bill had its ‘first reading’ in the House of Commons on 25 March, with its full text published, 28 March. The next step for the bill in Parliament is ‘second reading’, during which the first real debates on its content take place.
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April 2013 The Finance bill has completed the second reading and the first part of the Committee stages. Certain clauses were considered by the Committee of the Whole House, and the remaining clauses are to be considered by a Public Bill Committee.
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Tax legislation adopted and regulatory update Corporate income tax April 2013 The European Commission announced it is opening an investigation of the UK’s proposed video games tax relief. The EC intends to evaluate whether the tax relief is ‘aid’ that is necessary, not discriminatory, and will not distort competition.
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April 2013 HM Revenue & Customs issued updated guidance on the general anti-abuse rule (GAAR) and included specific examples of transactions.
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