Tax configuration - As individualised and perfect as a tailormade suit
Individuality – not a term one usually associates with taxes. Sober figures, clear instructions, laws ... Nevertheless, this plays an absolute key role in the advice we give our clients. Because: each of our clients is different. Just as in “real life”, each one of them has completely different objectives and requirements. For some, security is a very important issue, for others, flexibility is as important as the air they breathe. A younger client aged around 35 naturally has completely different priorities to a businessman aged around 64 who has imminent plans to transfer the management of the company to the younger generation.
We therefore analyse the objectives of our clients in great detail to ensure that we provide them with the optimal tax configuration.
And another reason why tax configuration is a highly customised process today is the ever faster changes to the underlying economic frameworks – tax models are no longer everlasting and carved in stone!
A small cross-section of the tax questions which we have dealt with in the recent past reveals: the range of issues is very broad-based – the requirements are complex:
Which legal form is the most beneficial – GmbH or GmbH & Co. KG? Is it better to lease or purchase? Is it possible to recover the losses made by a stock corporation? What happens when a company is split up as a result of insolvency? Is it worth moving production abroad? What is the optimal solution to regulate inheritance matters? Which requirements need to be fulfilled to ensure that a group of companies does not run aground with transfer prices? And when is the best time to prudently transfer a company?
Shareholders – managing directors
Are there any social insurance obligations? Which aspects are important when adjusting salaries? How high can a bonus be? Salary or dividends – which is more favourable from a taxation point of view? Can the managing director of a GmbH & Co. KG avoid the obligation to pay turnover tax with respect to his or her salary?
Does it make more sense to work on a self-employed basis or to establish a GmbH? Is a laboratory business subject to turnover tax? Is the sale of a split practice subject to lower taxes? When does the bookkeeping have to change or when should it be changed?
Employers and employees
What are the options for remunerating employees without having to pay social security contributions? What sort of pension models are available for the employer?
Can “tax exempt amounts” be harnessed via intelligent investments abroad? What is the best course of action for the cash to be paid out in the near future from a life insurance policy?
Should a property be deliberately transferred to commercial usage? What happens to overseas properties in the case of inheritance - are they subject to double inheritance tax? How are the purchasing costs for a property split up (land, building)? Is it best to gift money or to gift indirectly in the form of property – and which aspects need to be taken into consideration? Which disadvantages need to be taken into consideration when realising construction projects with input tax deduction?
There are any number of other things we could list here... But this cross-section is certain to already give an initial impression about the issues and challenges which we deal with on a daily basis.