Company foundation picture

What are the reporting obligations in Germany when establishing a foreign company?

In one of our previous articles, we already presented our "MORE-STUFF PLAN" for a possible relocation of the center of life abroad. The attentive and well-prepared online marketer, consultant and founder was provided with a comprehensive checklist.

These serve as a tool for clarifying complex questions in the context of international tax law. Furthermore, questions for clarification were identified that are at the heart of life.

We have already pointed out important aspects to the prudent and well-advised online marketer, consultant or founder who is considering moving the center of his or her life abroad permanently.

In today's issue, we look at the "Reporting obligations in Germany when establishing a foreign company".

The demand for the establishment of foreign companies has increased considerably in recent years. If you are liable for tax in Germany, the investment in a foreign company must be reported to your local tax office within one month of acquiring the investment.

Whether the investment is made directly or via a trustee is irrelevant. Failure to comply with the reporting obligation constitutes an administrative offense and can be punished with a fine.

If a holding company is established in a country of the European Union that is not classified as a "low-tax country", the reporting obligation can be modified.

Our consulting strategy by authorized legal service providers:

1. a holding company holds the shares in your foreign company in the low-tax country.

2 . the investment in the EU holding company is duly reported to the local tax office.

How is the cash flow managed?

Only minimal profits are distributed from the foreign company to the holding company. Taxation takes place properly in the respective country of the European Union.

The EU holding company therefore serves as "visual protection". If the country of domicile of the holding company has signed a double taxation agreement (DTA) with the country of domicile of your foreign company, but its country of domicile is not the same as your country of residence, then a holding company also makes sense.

Clarification from consulting practice:

It is possible to set up a holding company in Malta or Ireland. Despite membership of the European Union, these are classified as "low-tax countries". There is a need for explanation and justification when setting up a holding company. A review of add-back taxation can be initiated.

With a view to the moderate expense of use of our business addresses on 5 continents we address serious entrepreneurs on their way to global entrepreneurship. We create clarity through positioning.

If a foreign company is founded, we will inform every entrepreneur of the requirement to "build up substance" as part of the structuring consultation without being asked.

Bernd Ferber, CEO of Tempulse Consultancy Global, makes it clear that many competitors completely neglect the issue of "building up substance" in the context of international tax law.

In the next series, we will focus on "add-back taxation".

How to set up a successful international company and do everything right from a multicultural perspective?

? How my team and I support your journey as a global entrepreneur?

➕ Location consulting

- Recording and analysis of the current situation

- Positioning your company

- Optimization of the company website

NEW-WORK workshops and training courses

☑ Would you like to work with me and my team on your strategy for successful internationalization or use us for your company?

Talk to us here: Contact

Share your thoughts and connect with us on LinkedIN
Discover our contributions on our Tempulse.Global Youtube Channel!

P.S. We have opted for the DU culture. Would you like a different form of address? Please let us know.

Leave a Comment

Your email address will not be published. Required fields are marked *