ARTICLE · 09 MAY 2002

242. Transfer Pricing: Cross-Border Secondment Regulations

KPMG Germany

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Dr. Arwed Crüger and Volker Schmitt, KPMG Frankfurt

For editorial cut-off date, disclaimer, and notice of copyright see end of this article.

1. General

The German Federal Ministry of Finance issued transfer pricing regulations for cross-border secondments in November 2001 (Grundsätze für die Prüfung der Einkunftsabgrenzung zwischen international verbundenen Unternehmen in Fällen der Arbeitnehmerentsendung), published in BStBl. 2001 I, 796. The administrative regulations address the allocation of secondment-related expenses among internationally associated companies for purposes of German taxes on business profits (primarily the trade tax on earnings and the corporate income tax). They do not deal with the expatriate's personal income tax or with social security issues.

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