Taxing a company acquisition in Germany

In a corporate transaction, at least two parties – namely the buyer and the seller – are confronted with the question of the tax implications of a transaction. However, tax consequences can also affect the target company itself (e.g. in the form of a limitation of tax loss carryforwards in the case of higher share transfers).

As a rule, the two contracting parties to a German corporate transaction pursue different, often even opposing, strategic, economic and tax interests with the sale or acquisition of a company. While the seller seeks to achieve the highest possible after-tax purchase price, the buyer is interested in paying a low price and being able to claim the payable purchase price as quickly as possible against income.