Taxation of private individuals

Our advice and representation of individuals in income tax matters begins with an examination of their tax liability in Germany (unlimited or limited) and covers all types of income. Our advice in this area also includes disputes with the tax authorities in tax audits or appeal proceedings as well as structuring advice to optimise individual tax situations.

Tax liability, relocation and immigration

In the case of economically relevant circumstances in an international context, we clarify whether these have any tax consequences in Germany and, if so, to what extent Germany has the right to tax them.
Moving into and, in particular, moving out of Germany has considerable tax consequences, so that both moving in and moving out must be prepared and accompanied from a tax law perspective.

Tax law issues in the seven types of income

In the case of types of income (agriculture and forestry, business operations, self-employment/freelance work), questions regularly arise regarding the distinction between private and business assets, the problem of unintentional realisation of hidden reserves, restructuring or transfer of the source of income.
The types of income from agriculture and forestry and self-employment/freelance work must be distinguished from income from business operations. Both in the context of tax dispute counselling and in the context of structuring advice, the question of avoiding commerciality regularly arises.
Income from employment (employee taxation) often raises questions in connection with bonus payments, employee participation schemes, secondment abroad and, for example, cross-border activities. In practice, the distinction between self-employment and bogus self-employment also plays a major role.
With regard to property taxation, we advise on issues such as real estate transfer tax on the sale/acquisition, speculative gains from the sale of property, commercial property trading and the transfer of property from business assets to private assets or vice versa.
In the case of income from letting and leasing, the question of the distinction from commerciality is also frequently at issue. When asserting losses from letting and leasing, the question of hobby arises.
We advise shareholders of corporations on the sale of shares in the corporation as well as on issues relating to current taxation of dividends received, shareholder loans and the question of whether the shareholding is part of private or business assets. If assets are transferred to the corporation, e.g. the business premises, the question of splitting the business arises. In the SME sector, the problem of splitting a business is one of the central tax law problems in disputes with the tax authorities. Advice is provided to avoid a business split and in particular to avoid an unintended dissolution of a business split. In the case of distributions from the company to the shareholders, the question arises as to whether they qualify as dividends, hidden profit distributions or distributions from the contribution account.
We advise managing directors of corporations in connection with the drafting of the management contract with regard to all remuneration models. In the case of shareholder managing directors, the question of social security obligations and, in particular, hidden profit distribution also arises.
In the case of speculative transactions, not only real estate but also other assets such as cryptocurrencies are the focus of the tax authorities. Here we advise on the correct declaration and subsequent declaration of corresponding gains. The same applies to foreign currency gains.
Natural persons who are involved in a partnership regularly need advice on the capital account structure, the distinction between private assets and special business assets, the transfer of assets between private assets and joint assets and the distinction between these and commercial activities. In particular, the unintentional withdrawal of assets from the (unrecognised) special business assets harbours considerable risks, which we advise on how to avoid.