The foreign PropCo in the real estate sector – a controllable risk
The tax authorities are increasingly focusing on low-functioning foreign companies. They routinely check the place of management or the existence of a permanent establishment in Germany for trade tax purposes to determine whether tax obligations in Germany have been violated in the past. Often, for various reasons, the accusation of tax evasion is made prematurely and intent is assumed.
Thus, there is a potential risk of criminal prosecution for tax evasion for the formal managing directors of the foreign-based PropCo (e.g. LuxCo or Dutch B.V.) and also for any so-called "de facto managing directors" who actually perform the role of a managing director. In addition, there is also a risk for the foreign PropCo itself of corporate fines or confiscation of its assets. Finally, the PropCo may incur substantial unexpected back taxes and interest, for which the managing directors may be personally liable.
Against this background, we offer a compliance project specifically designed to address these risks:
Step 1: Risk analysis
On the basis of selected documents, interviews and other measures, the relevant facts are determined, analyzed and evaluated in terms of tax law. Concrete tax or sanction risks for the foreign PropCo and its (de facto) managing directors are then presented.
Step 2: Concrete recommendations for action
In order to minimize these risks, concrete recommendations for action are drawn up, based on the individual organizational structure and existing processes.
Step 3: Documentation precaution concept
Together with you, we develop a concept on how the correct handling according to tax law can also be proven to the tax authorities.
At the end of the project, with regard to the place of management in accordance with Sec. 10 of the Fiscal Code of Germany (AO), you will receive a written
- presentation of the facts
- evaluation from a tax law perspective
- individually tailored recommendations for action
- conceptual design for documentation precaution
so that questions and submission requests of the tax office can be answered quickly and completely in order to minimize the aforementioned risks.
Increased advisory and monitoring duties upon the occurrence of an insolvency event
Criminal Tax Law | Procedural Tax Law advice and Criminal Court Defense | Tax Integrity | Litigation focusing on Customs, Excise Duty and Foreign Trade Law