Family businesses are now threatened with high tax back payments
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A number of family businesses that put their employees on short-time work or even laid off employees during the Corona crisis are threatened with high back payments. The reason is a regulation in inheritance tax law.
F.According to information from WELT AM SONNTAG, amile companies that have been transferred in whole or in part to successors within the past seven years are at risk of unexpected tax back payments. The reason is a regulation in inheritance tax law, which provides for tax exemption for business assets.
This benefit is tied to the condition that the business continues for up to seven years and that the wages remain stable during this period. This is contradicted by companies that have sent employees on short-time work or laid off employees during the crisis.
The president of the family business, Reinhold von Eben-Worlée, called for an exception to this tax regulation in view of the crisis. “Family businesses that are in the process of being handed over and at the same time are fighting for the survival of their company with the economic corona restrictions imposed by politicians, must not additionally and through no fault of their own have an obligation to pay back inheritance tax,” he told WELT AM SONNTAG.
Wolfgang Steiger, Secretary General of the CDU Economic Council, spoke of a “worrying situation”. In the event of an additional payment, companies would be deprived of massive equity in the middle of the crisis.
The economist Lars Feld emphasized that the freedom of trade is currently severely restricted. This exceptional situation must be taken into account with inheritance tax. When applying the exemption regulation, the Corona years 2020 and 2021 should therefore not be taken into account and the deadlines should be extended accordingly, said the chairman of the Advisory Council on the assessment of macroeconomic development. “For this a change in the law is needed. That cannot be left to the discretion of the tax authorities. “
The Association of Family Businesses called such an emergency rule “vital”. According to the Federal Ministry of Finance, between 2014 and 2018 around five percent of all medium-sized companies were transferred as part of a succession.
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