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Complicated Transfer of Tax Losses between Entities in the European Union
[Komplikovaný přenos daňové ztráty mezi subjekty v zemích Evropské unie]

Author

Listed:
  • Jana Skálová

Abstract

The article deals with the possibility of taxing the company plans to expand abroad through cross-border mergers. They discussed two alternatives fiscal relations - establishment of a subsidiary company for the use of losses incurred by subsidiary companies to reduce the tax base of the parent company. The second alternative examines the application of the losses incurred during the existence of branches abroad. Income tax advantages that may be gained in cross-border merger were implemented by virtue of Directive 90/434/EEC. The Income Tax Act allows Czech successor companies to take over tax losses that were incurred by foreign merging companies and that have not been used yet. At this point, tax advantages could be at least described as problematic or even unattainable.

Suggested Citation

  • Jana Skálová, 2010. "Complicated Transfer of Tax Losses between Entities in the European Union [Komplikovaný přenos daňové ztráty mezi subjekty v zemích Evropské unie]," Český finanční a účetní časopis, Prague University of Economics and Business, vol. 2010(4), pages 7-18.
    • Handle: RePEc:prg:jnlcfu:v:2010:y:2010:i:4:id:82:p:7-18
    DOI: 10.18267/j.cfuc.82
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    More about this item

    Keywords

    Cross-border merger; Tax loss; Subsidiary; Branch; Přeshraniční fúze; Daňová ztráta; Dceřiná společnost; Organizační složka;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • K34 - Law and Economics - - Other Substantive Areas of Law - - - Tax Law

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