Which problems BREXIT will cause in detail is still unclear. At the present time, the BREXIT negotiations have led neither to a final resignation agreement nor to regulations of the legal relationships valid at least for a transitional period. Even a withdrawal of Great Britain without any contractual agreement with the states of the European Union and the European Economic Area does not seem impossible. This could also lead to the non-replacement of the interest-free deferral of exit taxation in accordance with § 6 AStG.
According to the previous legal situation, the shareholder of a corporation had to disclose the hidden reserves of its shares within the meaning of § 17 EStG in the event of a move to Great Britain, but these were deferred interest-free until the actual sale of the shares due to the move to an EU member state in accordance with § 6 V AStG. Another regulation would also be incompatible with the freedom of establishment of the EU (Art. 49 TFEU), as already ruled by the European Court of Justice in 2004 (Case C-9/02 Lasteyrie du Saillant of 11.03.2004). The shareholder of a corporation must always tax the hidden reserves immediately, without the possibility of deferral, in the event of moving to a country not belonging to the EU/EEA. With BREXIT, the conditions for tax deferral would no longer be met in Great Britain either. With BREXIT and the inapplicability of the relevant standard, the ECJ case law also loses its basis.
Accordingly, there is a risk that the deferral will be revoked and the corresponding tax receivables will fall due without a corresponding inflow of liquidity as a result of an actual sale of the shares. Taxpayers affected should be aware of this danger and actively prepare for this scenario. Hoping for transitional arrangements in your favour could have considerable consequences.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
