Loss limitation in case of a tax neutral merger: Supreme Court dots the i’s and crosses the t’s
Carried forward tax losses of both the absorbed and absorbing company are subject to limitation upon a tax neutral merger. As regards tax losses of the absorbing company, it is generally accepted by tax practitioners that the loss limitation rule only applies to prior year tax losses (i.e. losses reported in the latest tax return
Negative ruling highlights pitfalls of pre-deal carve-outs through partial demergers
In a recent decision, the Belgian ruling office rejected a pre-deal carve-out of real estate through a tax neutral partial demerger followed by a tax exempt transfer of shares of the operating company. Though the ruling does not particularly divulge novel views, it has the merit of highlighting common pitfalls related to these type of
VAT deduction on deal fees for an aborted transaction, and not for an intended sale of shares
Recently, the CJEU decided on two important cases with respect to the VAT deduction on deal fees (see C-249/17 Rynair Ltd. And C-502/17 C&D Foods Acquisition) in a seemingly opposing manner. Ryanair case In the Ryanair case, deal fees were incurred in relation to a failed takeover of a competitor. Ryanair claimed input VAT deduction
