Austria: goodwill amortization

Austria.

Goodwill amortization

With the group taxation regime coming into effect in 2005, the legislator simultaneously introduced a goodwill amortization on share deals in case an Austrian tax group is established. In any case, goodwill is limited to 50% of the acquisition cost and is to be amortized over a period of 15 years.

Claiming goodwill amortization is, however, subject to the following restrictions: shares may not by purchased by another company of the group and/or majority shareholder. The acquired company must form a group with the purchaser and finally the acquired company must be an Austrian company subject to unrestricted taxation exercising an entrepreneurial activity.

Last year in April the Linz independent finance tribunal, referring to the freedom of establishment applied in the EU, extended the scope of goodwill amortization by declaring that it is applicable also to the acquisition of shares of subsidiaries established in the European Union. By doing so, the independent finance tribunal rejected the distinction between Austrian corporations and EU corporations.

To have a consultation by Alessandro Pasut about goodwill amortization in Austria click here

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