# C_2011252EN.01000301.xml

| 27.8.2011 | EN | Official Journal of the European Union | C 252/3 |
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27.8.2011

EN

Official Journal of the European Union

C 252/3

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Judgment of the Court (First Chamber) of 30 June 2011 (reference for a preliminary ruling from the Finanzgericht Köln (Germany)) — Wienand Meilicke, Heidi Christa Weyde, Marina Stöffler v Finanzamt Bonn-Innenstadt

(Case C-262/09) (1)

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(Free movement of capital - Income tax - Certificate relating to corporation tax actually paid on dividends of foreign origin - Prevention of double taxation of dividends - Tax credit for dividends paid by resident companies - Proof required as to the foreign tax deductible)

2011/C 252/03

Language of the case: German

Referring court

Referring court

Finanzgericht Köln

Parties to the main proceedings

Parties to the main proceedings

Applicants: Wienand Meilicke, Heidi Christa Weyde, Marina Stöffler

Applicants:

Defendants: Finanzamt Bonn-Innenstadt

Defendants:

Re:

Re:

Reference for a preliminary ruling — Finanzgericht Köln — Interpretation of Articles 56 and 58(1)(a) and (3) EC and the principles of effectiveness and utility — Distribution of dividends by a company established in one Member State to a taxable person in another Member State — Compatibility with Community law of an income tax scheme in the other Member State which allows a tax credit of 3/7 of the gross dividends, although the corporation tax levied on those dividends cannot in practice be determined for a company established in another Member State, and which makes that tax credit subject to the presentation of a corporation tax declaration drawn up according to its own tax legislation, although it is in practice impossible for the taxable person to produce it for a company established in another Member State

Operative part of the judgment

Operative part of the judgment

| 1. | For the calculation of the amount of the tax credit to which a shareholder who is fully taxable in a Member State with regard to dividends paid by a capital company established in another Member State is entitled, Articles 56 EC and 58 EC preclude the application — if evidence required under the legislation of the first Member State is not adduced — of a provision such as Paragraph 36(2), second sentence, point 3 of the Law on Income Tax (Einkommensteuergesetz) of 7 September 1990, as amended by the Law of 13 September 1993, under which corporation tax imposed on dividends of foreign origin is set off against a shareholder’s income tax to the level of the fraction of corporation tax imposed on gross dividends distributed by companies in the first Member State.
  The calculation of the tax credit must be made in relation to the rate of corporation tax on the distributed profits applicable to the dividend-paying company according to the law of the Member State of establishment, however the amount to be imposed may not exceed the amount of the income tax to be paid on dividends received by the recipient shareholder in the Member State in which that shareholder is fully taxable. |
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1.

For the calculation of the amount of the tax credit to which a shareholder who is fully taxable in a Member State with regard to dividends paid by a capital company established in another Member State is entitled, Articles 56 EC and 58 EC preclude the application — if evidence required under the legislation of the first Member State is not adduced — of a provision such as Paragraph 36(2), second sentence, point 3 of the Law on Income Tax (Einkommensteuergesetz) of 7 September 1990, as amended by the Law of 13 September 1993, under which corporation tax imposed on dividends of foreign origin is set off against a shareholder’s income tax to the level of the fraction of corporation tax imposed on gross dividends distributed by companies in the first Member State.

The calculation of the tax credit must be made in relation to the rate of corporation tax on the distributed profits applicable to the dividend-paying company according to the law of the Member State of establishment, however the amount to be imposed may not exceed the amount of the income tax to be paid on dividends received by the recipient shareholder in the Member State in which that shareholder is fully taxable.

| 2. | As regards the degree of detail which the evidence required must meet in order to benefit from a tax credit relating to dividends paid by a capital company established in a Member State other than that where the beneficiary is fully taxable, Articles 56 EC and 58 EC preclude the application of a provision such as Paragraph 36(2), second sentence, point 3, fourth sentence, (b) of the EStG under which the degree of detail and the form of evidence to be adduced by such a shareholder must be the same as those required where the dividend-paying company is established in the Member State of taxation of that shareholder.
  The tax authorities of the Member State of taxation are entitled to require that shareholder to provide documentary evidence enabling them to ascertain, clearly and precisely, whether the conditions for obtaining a tax credit under national legislation are met without having to make an estimate of that tax credit. |
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2.

As regards the degree of detail which the evidence required must meet in order to benefit from a tax credit relating to dividends paid by a capital company established in a Member State other than that where the beneficiary is fully taxable, Articles 56 EC and 58 EC preclude the application of a provision such as Paragraph 36(2), second sentence, point 3, fourth sentence, (b) of the EStG under which the degree of detail and the form of evidence to be adduced by such a shareholder must be the same as those required where the dividend-paying company is established in the Member State of taxation of that shareholder.

The tax authorities of the Member State of taxation are entitled to require that shareholder to provide documentary evidence enabling them to ascertain, clearly and precisely, whether the conditions for obtaining a tax credit under national legislation are met without having to make an estimate of that tax credit.

| 3. | The principle of effectiveness precludes national legislation like that arising from the combined provisions of the second sentence of Paragraph 175(2) of the amended Regulations on Taxes (Abgabenordnung) and the third sentence of Paragraph 97(9) of the Law introducing the Tax Code (Einführungsgesetz zur Abgabenordnung), which, retroactively and without any transitional period, does not permit the offsetting of foreign corporation tax imposed on dividends paid by a capital company established in another Member State by submitting either a certificate relating to that tax in accordance with the legislation of the Member State in which the shareholder is fully taxable, or documentary evidence allowing the tax authorities of that Member State to determine, clearly and precisely, whether the conditions for obtaining that tax advantage were met. It is for the referring court to determine a reasonable period for the submission of such a certificate or documentary evidence. |
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3.

The principle of effectiveness precludes national legislation like that arising from the combined provisions of the second sentence of Paragraph 175(2) of the amended Regulations on Taxes (Abgabenordnung) and the third sentence of Paragraph 97(9) of the Law introducing the Tax Code (Einführungsgesetz zur Abgabenordnung), which, retroactively and without any transitional period, does not permit the offsetting of foreign corporation tax imposed on dividends paid by a capital company established in another Member State by submitting either a certificate relating to that tax in accordance with the legislation of the Member State in which the shareholder is fully taxable, or documentary evidence allowing the tax authorities of that Member State to determine, clearly and precisely, whether the conditions for obtaining that tax advantage were met. It is for the referring court to determine a reasonable period for the submission of such a certificate or documentary evidence.

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(1)  OJ C 267, 7.11.2009.

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