127. Amortisation Of Purchased Trademarks

KPMG Germany Webpage
Click on the above link to visit the KPMG Germany webpage on the Mondaq website
For disclaimer and copyright see end of this article.

In article no. 64, we reported on a ruling by the Federal Tax Court under the valuation law as in force through December 1992 (ruling of 4 September 1996 - BB 1996, 2608). The court categorically rejected the amortisation of purchased trademarks absent special circumstances, e.g. a showing that the trademark is only of value with respect to a particular product with a fixed lifetime.

In our article, we pointed out that there was reason to suppose that the tax authorities would not apply the court's reasoning for income tax purposes. Official assurances by the tax authorities to this effect appeared possible.