CELEX: 62017CJ0480
Language: en
Date: 2018-12-06 00:00:00
Title: Judgment of the Court (Tenth Chamber) of 6 December 2018.#Frank Montag v Finanzamt Köln-Mitte.#Request for a preliminary ruling from the Finanzgericht Köln.#Reference for a preliminary ruling — Freedom of establishment — Direct taxation — Income tax — Deductibility of contributions to an occupational pension scheme and to a private pension scheme — Exclusion of non-residents.#Case C-480/17.

JUDGMENT OF THE COURT (Tenth Chamber)
      6 December 2018 (
            *1
         )
      (Reference for a preliminary ruling — Freedom of establishment — Direct taxation — Income tax — Deductibility of contributions to an occupational pension scheme and to a private pension scheme — Exclusion of non-residents)
      In Case C‑480/17,
      REQUEST for a preliminary ruling under Article 267 TFEU from the Finanzgericht Köln (Finance Court, Cologne, Germany), made by decision of 3 August 2017, received at the Court on 9 August 2017, in the proceedings
      
         Frank Montag
      
      v
      
         Finanzamt Köln-Mitte,
      
      THE COURT (Tenth Chamber),
      composed of F. Biltgen, President of the Eighth Chamber, acting as President of the Tenth Chamber, E. Levits (Rapporteur) and L. Bay Larsen, Judges,
      Advocate General: M. Campos Sánchez-Bordona,
      Registrar: C. Strömholm, Administrator,
      having regard to the written procedure and further to the hearing on 12 July 2018,
      after considering the observations submitted on behalf of:
      
               –
            
            
               Mr Montag, by S. Eilers and S. Lehmann, Rechtsanwälte,
            
         
               –
            
            
               the Finanzamt Köln-Mitte, by M. Plützer, acting as Agent,
            
         
               –
            
            
               the German Government, by T. Henze and R. Kanitz, acting as Agents,
            
         
               –
            
            
               the European Commission, by W. Roels, M. Wasmeier and B.-R. Killmann, acting as Agents,
            
         having decided, after hearing the Advocate General, to proceed to judgment without an Opinion,
      gives the following
      
         Judgment
      
      
               1
            
            
               This request for a preliminary ruling concerns the interpretation of Article 49 TFEU.
            
         
               2
            
            
               The request has been made in proceedings between Mr Frank Montag and the Finanzamt Köln-Mitte (Tax Office, Cologne Central, Germany) concerning a refusal to deduct contributions to an occupational pension scheme and to a private pension scheme, as special expenses, for the purposes of reducing tax in the framework of limited tax liability in Germany.
            
         
         Legal context
      
      
         
            European Union law
         
      
      
               3
            
            
               Recital 12 of Directive 98/5/EC of the European Parliament and of the Council of 16 February 1998 to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained (OJ 1998 L 77, p. 36), as amended by Council Directive 2006/100/EC of 20 November 2006 (OJ 2006 L 363, p. 141) (‘Directive 98/5’), provides that a lawyer registered under his home-country professional title in the host Member State must remain registered with the competent authority in his home Member State if he is to retain his status of lawyer and be covered by that directive.
            
         
               4
            
            
               Article 3(1) and (2) of Directive 98/5 is worded as follows:
               ‘1.   A lawyer who wishes to practise in a Member State other than that in which he obtained his professional qualification shall register with the competent authority in that State.
               2.   The competent authority in the host Member State shall register the lawyer upon presentation of a certificate attesting to his registration with the competent authority in the home Member State. It may require that, when presented by the competent authority of the home Member State, the certificate be not more than three months old. It shall inform the competent authority in the home Member State of the registration.’
            
         
         
            German law
         
      
      
               5
            
            
               Paragraph 1 of the Einkommensteuergesetz (Law on income tax), as amended by the 2008 tax law, of 20 December 2007 (BGBl. 2007 I, p. 3150) (‘the EStG 2008’), provides:
               ‘(1)   Natural persons whose place of residence or habitual residence is in Germany shall be subject to unlimited income tax liability. …
               …
               (3)   At their request, natural persons whose place of residence or habitual residence is not in Germany shall also be treated as subject to unlimited income tax liability provided that they receive income in Germany within the meaning of Paragraph 49. This applies only if at least 90% of their income during the calendar year is subject to German income tax or if their income which is not subject to German income tax does not exceed the tax-free allowance under the first indent of the second sentence of Paragraph 32a(1); …
               (4)   Natural persons whose place of residence or habitual residence is not in Germany shall, subject to subparagraphs 2 and 3 and to Paragraph 1a, be subject to limited income tax liability if they receive income in Germany within the meaning of Paragraph 49.’
            
         
               6
            
            
               Paragraph 10 of the EStG 2008, entitled ‘Special expenses’, provides:
               ‘(1)   Provided that they are not business or occupational expenses or are not treated as such, the following expenses shall constitute special expenses:
               …
               
                        2.
                     
                     
                        
                                 (a)
                              
                              
                                 ... contributions to professional insurance funds which provide comparable benefits to statutory pension funds;
                              
                           
                                 (b)
                              
                              
                                 contributions to a self-funded personal pension …
                              
                           
                  …
               (3)   The provident expenses referred to in the second sentence of subparagraph 1(2) shall be taken into consideration up to a ceiling of EUR 20000 ...’
            
         
               7
            
            
               Paragraph 50(1) of the EStG 2008, entitled ‘Special provisions on persons subject to limited tax liability’, states:
               ‘Persons subject to limited tax liability may deduct business expenses (Paragraph 4(4) to (8)) or occupational expenses (Paragraph 9) only to the extent that those expenses are economically linked to income of German origin. … Paragraphs … 10 … shall not apply. ...’
            
         
         The dispute in the main proceedings and the questions referred for a preliminary ruling
      
      
               8
            
            
               In 2008, the applicant in the main proceedings, a German national, was resident in Belgium where he worked as a lawyer in an international law firm which was registered as a limited liability partnership (‘the LLP’), and held shares in that partnership for the purposes of company law.
            
         
               9
            
            
               As an equity partner, the applicant in the main proceedings earned income which was treated as derived from several countries following a procedure for the assessment and distribution of income, which is not at issue between the parties in the main proceedings. As part of the net world profit which was attributed to the applicant in the main proceedings from his shareholding and activities in the LLP, approximately 54% of that net world profit was received in Germany, approximately 6.3% in Belgium and the remainder in other countries. In 2008, the applicant in the main proceedings also received other income. The referring court states that the applicant in the main proceedings cannot be regarded as subject to unlimited income tax liability in Germany under Paragraph 1(3) of the EStG 2008 due, first, to the fact that less than 90% of his total income is subject to income tax in Germany and, second, the amount of his income not subject to German income tax exceeds his tax-free allowance.
            
         
               10
            
            
               In 2008, the applicant in the main proceedings was registered as a ‘European lawyer’ on List E of the Ordre français du barreau de Bruxelles (French-speaking Brussels Bar, Belgium) under the professional title of ‘Rechtsanwalt
                  (Cologne) établi à Bruxelles’ (Lawyer (Cologne) established in Brussels). In order to practise in that capacity, the applicant in the main proceedings was required to be registered with the Rechtsanwaltkammer Köln (Cologne Bar Association, Germany) and, as such, it was compulsory for him to be a member of the Versorgungswerk der Rechtsanwälte Nordrhein-Westfalen (The North Rhine-Westphalia Lawyers’ Pension Scheme, Germany, ‘the lawyers’ provident institution’). In accordance with the German legislation on the statutory pension scheme, employed and self-employed members of an occupational pension scheme are exempt from the obligation otherwise applicable of membership of the German statutory pension scheme.
            
         
               11
            
            
               In 2008, the applicant in the main proceedings paid a contribution in the amount of EUR 16 453.32 to the lawyers’ provident institution, the maximum contribution which could have been paid. Of that amount, EUR 12 656.40 formed compulsory contributions and EUR 3 796.92 additional voluntary contributions. Furthermore, the applicant in the main proceedings paid contributions into a private pension scheme in Germany in the amount of EUR 3696.
            
         
               12
            
            
               The applicant in the main proceedings was subject to unlimited income tax liability in Belgium. According to information provided by the applicant, restated by the referring court, the payments made to the lawyers’ provident institution in Germany did not result in a deduction of the tax paid in Belgium. However, for the purposes of determining the basis of assessment in Belgium, the mandatory payments to the Belgian statutory social security system were able to be deducted.
            
         
               13
            
            
               In respect of income tax for 2008, as a taxable person subject to a limited liability to tax, the applicant in the main proceedings sent the defendant in the main proceedings a tax declaration and applied for a deduction of the contributions paid to the lawyers’ provident institution and into a private pension fund in Germany as withheld occupational expenses under the third sentence of Paragraph 22(1) of the EStG 2008 or, alternatively, as special expenses under Paragraph 10(1)(2) of that law.
            
         
               14
            
            
               In determining the income tax basis of assessment, the defendant in the main proceedings refused to deduct those contributions on the ground that they related to the category of ‘special expenses’, set out in Paragraph 10 of the EStG 2008. The third sentence of Paragraph 50(1) of the EStG 2008 excludes special expenses from being deducted in the case of limited tax liability. In the view of the defendant in the main proceedings, such expenses also cannot be deducted as occupational expenses under Paragraph 9 of that law or as business expenses under Paragraph 4(4) of that law.
            
         
               15
            
            
               Following the rejection of the complaint lodged by the applicant in the main proceedings against that refusal, he brought an action before the Finanzgericht Köln (Finance Court, Cologne, Germany). A stay in the proceedings before that Court was ordered until July 2016 on account of proceedings for a preliminary ruling before the Court of Justice in the case which gave rise to the judgment of 24 February 2015, Grünewald (C‑559/13, EU:C:2015:109), and of proceedings brought before the Bundesverfassungsgericht (Federal Constitutional Court, Germany).
            
         
               16
            
            
               In essence, since the Bundesverfassungsgericht (Federal Constitutional Court) held that it was not unconstitutional for the German legislature to treat provident expenses as special expenses, the applicant in the main proceedings now seeks the deduction of his provident expenses as special expenses pursuant to Paragraph 10(1)(2) of the EStG 2008, within the limits set out in Paragraph 10(3) thereof, and for the third sentence of Paragraph 50(1) of that law, which provides for a deduction in respect of non-resident taxable persons, not to be applied as contrary to EU law.
            
         
               17
            
            
               The referring court notes that, although he earns most of his income in Germany, the applicant in the main proceedings earned sufficient income, in Belgium, for his personal situation to be taken into account there.
            
         
               18
            
            
               However, that court asks whether the provident expenses at issue in the main proceedings must be treated, under EU law, as expenses relating to the taxable person’s personal and family circumstances or expenses relating to income received in Germany.
            
         
               19
            
            
               In those circumstances, the Finanzgericht Köln (Finance Court, Cologne) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:
               
                        ‘(1)
                     
                     
                        Does Article 49 TFEU read in conjunction with Article 54 TFEU preclude a national rule under which compulsory contributions to an occupational pension scheme made by a non-resident taxpayer (on the basis of his membership of a bar association in the Member State, which is mandatory on professional grounds for the purposes of his activity carried on in several Member States) are not treated as deductible from income within the framework of limited tax liability, whereas in the case of resident taxpayers national law permits their deduction from income up to a specific ceiling within the framework of unlimited tax liability?
                     
                  
                        (2)
                     
                     
                        Does Article 49 TFEU read in conjunction with Article 54 TFEU preclude the national rule described in Question 1 in the case where, in addition to his compulsory contributions, the taxpayer makes additional (voluntary) contributions to the occupational pension scheme and the Member State does not treat these as deductible from income although, under national law, future pension benefits payable in that Member State may be taxable even in the framework of limited tax liability?
                     
                  
                        (3)
                     
                     
                        Does Article 49 TFEU read in conjunction with Article 54 TFEU preclude the national rule described in Question 1 in the case where the taxpayer, independently of his admission as a lawyer and his contributions to an occupational pension scheme, makes contributions to a voluntary private pension scheme and the Member State does not treat these as deductible from income although, under national law, future pension benefits payable in that Member State may be taxable even in the framework of limited tax liability?’
                     
                  
         
         Consideration of the questions referred
      
      
               20
            
            
               By its questions, which it is appropriate to consider together, the referring court asks, in essence, whether Article 49 TFEU must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, under which a non-resident taxable person, subject, in that Member State, to income tax in the framework of limited tax liability, cannot deduct from the income tax basis of assessment the amount of compulsory and additional contributions paid into an occupational pension scheme or the amount of contributions paid into a private pension scheme, whereas a resident taxable person, subject to income tax in the framework of unlimited tax liability, can deduct such contributions from the income tax basis of assessment to the extent laid down by national law.
            
         
         
            Existence of a restriction under Article 49 TFEU
         
      
      
               21
            
            
               Article 49 TFEU requires the abolition of restrictions on the freedom of establishment. The Court has consistently held that, even though, according to their wording, the FEU Treaty provisions on freedom of establishment are aimed at ensuring that foreign nationals are treated in the host Member State in the same way as nationals of that State, they also prohibit the Member State of origin from hindering the establishment in another Member State of one of its nationals or of a company incorporated under its legislation (see, to that effect, judgments of 13 April 2000, Baars, C‑251/98, EU:C:2000:205, paragraph 28 and the case-law cited; of 11 March 2004, de Lasteyrie du Saillant, C‑9/02, EU:C:2004:138, paragraph 42; and of 29 November 2011, National Grid Indus, C‑371/10, EU:C:2011:785, paragraph 35 and the case-law cited).
            
         
               22
            
            
               It is also settled case-law that all measures which prohibit, impede or render less attractive the exercise of the freedom of establishment must be regarded as restrictions on that freedom (judgment of 29 November 2011, National Grid Indus, C‑371/10, EU:C:2011:785, paragraph 36 and the case-law cited).
            
         
               23
            
            
               In the present case, in accordance with the national legislation at issue in the main proceedings, contributions to providential pension schemes, treated as special expenses in that legislation, may be deducted, within a certain limit, from the total income of a resident taxable person, subject to unlimited liability to income tax. Such a deduction allows such a taxable person to reduce the amount of taxable income and is therefore a tax advantage.
            
         
               24
            
            
               By contrast, non-resident taxable persons who are subject to limited tax liability cannot make such a deduction in Germany and therefore cannot benefit from that tax advantage.
            
         
               25
            
            
               Thus, since the tax treatment of non-residents is less advantageous, it is capable of rendering the establishment of a resident taxable person in a Member State other than the Federal Republic of Germany less attractive and, accordingly, amounts to a restriction in principle, which is prohibited by the Treaty provisions on the freedom of establishment.
            
         
               26
            
            
               It is clear from the Court’s case-law that such a restriction is permissible only if it relates to situations which are not objectively comparable or if it is justified by an overriding reason in the public interest (judgment of 17 July 2014, Nordea Bank Danmark, C‑48/13, EU:C:2014:2087, paragraph 23). It is further necessary, in such a case, that the restriction be appropriate for ensuring the attainment of the objective that it pursues and not go beyond what is necessary to attain it (judgment of 20 December 2017, Deister Holding and Juhler Holding, C‑504/16 and C‑613/16, EU:C:2017:1009, paragraph 91 and the case-law cited).
            
         
         
            A comparable situation
         
      
      
               27
            
            
               It is settled case-law that, in relation to direct taxes, the situations of residents and non-residents within a State are not, as a rule, comparable, since the income received in the territory of a Member State by a non-resident is in most cases only a part of his total income, which is concentrated at his place of residence, and because a non-resident’s personal ability to pay tax, determined by reference to his aggregate income and his personal and family circumstances, is easier to assess at the place where his personal and financial interests are centred, which in general is the place where he is habitually resident (see, inter alia, judgments of 31 March 2011, Schröder, C‑450/09, EU:C:2011:198, paragraph 37, and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 25).
            
         
               28
            
            
               Thus, the fact that a Member State does not grant to a non-resident certain tax benefits which it grants to a resident is not, as a rule, discriminatory, given the objective differences between the situations of residents and of non-residents, from the point of view both of the source of their income and of their personal ability to pay tax or their personal and family circumstances (see, inter alia, judgments of 31 March 2011, Schröder, C‑450/09, EU:C:2011:198, paragraph 38, and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 26).
            
         
               29
            
            
               The position is different, however, where the non-resident receives no significant income in the State of his residence and obtains the greater part of his taxable income from an activity performed in the other Member State concerned (judgment of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 27), and consequently the Member State of residence is not in a position to grant him the benefits that result from taking into account his personal and family circumstances (see, inter alia, judgments of 14 February 1995, Schumacker, C‑279/93, EU:C:1995:31, paragraph 36; of 16 October 2008, Renneberg, C‑527/06, EU:C:2008:566, paragraph 61; and of 18 June 2015, Kieback, C‑9/14, EU:C:2015:406, paragraph 25).
            
         
               30
            
            
               Moreover, the Court has also held, in relation to expenses directly linked to an activity which has generated taxable income in a Member State, that residents of that State and non-residents are in a comparable situation (see, inter alia, judgments of 31 March 2011, Schröder, C‑450/09, EU:C:2011:198, paragraph 40 and the case-law cited, and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 29).
            
         
               31
            
            
               In the present case, it follows from the observations of the referring court that, although he earned most of his income in Germany, the applicant in the main proceedings has, in Belgium, earned sufficient income for his personal and family circumstances to be taken into account there.
            
         
               32
            
            
               Accordingly, as regards the deduction of provident expenses in Germany, in a situation such as that at issue in the main proceedings, a non-resident, such as the applicant in the main proceedings, and a resident would be in a comparable situation only if, despite its characterisation under national law as special expenses, the provident expenses could be treated as expenses directly linked to an activity which has generated taxable income in Germany, within the meaning of the case-law set out in paragraph 30 above (see, by analogy, judgment of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 31).
            
         
               33
            
            
               In accordance with the Court’s case-law, expenses occasioned by the activity which generated taxable income are directly linked to that activity and are accordingly necessary in order to carry it out (see, to that effect, judgments of 12 June 2003, Gerritse, C‑234/01, EU:C:2003:340, paragraphs 9 and 27; of 15 February 2007, Centro Equestre da Lezíria Grande, C‑345/04, EU:C:2007:96, paragraph 25; and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 30).
            
         
               34
            
            
               It must be observed that it is ultimately for the national court, which has sole jurisdiction to determine the facts in the case before it and to interpret the national legislation, to determine whether that is the case here. However, in preliminary ruling proceedings, the Court, which is called on to provide answers of use to the national court, may provide guidance based on the documents in the file and on the written and oral observations submitted to it, in order to enable the national court to give judgment (see, inter alia, judgments of 16 May 2013, Alakor Gabonatermelő és Forgalmazó, C‑191/12, EU:C:2013:315, paragraph 31 and the case-law cited, and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 32).
            
         
               35
            
            
               In the present case, as regards, in the first place, the compulsory contributions paid to the lawyers’ provident institution, it follows from the order for reference that it was compulsory for the applicant in the main proceedings to be a member of that institution and he was required to pay contributions due to his registration with the Cologne Bar Association.
            
         
               36
            
            
               As is clear from the order for reference, that registration is compulsory in order for the applicant in the main proceedings to be able to practise, under the title of Rechtsanwalt, both in Germany, where he earns most of his professional income and where he has a limited liability to tax on that income, and, in accordance with Article 3 of Directive 98/5, in Belgium, the Member State where he is established and is resident.
            
         
               37
            
            
               The Court therefore finds that the expenses relating to the compulsory contributions paid to the lawyers’ provident institution were made because registration with the bar association was necessary in order to practise the activity which generated the taxable income. Those expenses must be regarded as having been generated by that activity and therefore as being necessary in order to carry it out.
            
         
               38
            
            
               That finding cannot be called into question by the arguments on which the defendant in the main proceedings and the German Government relied in that regard.
            
         
               39
            
            
               First of all, the fact, relied on both by the defendant in the main proceedings and by the German Government, according to which, in accordance with the articles of association governing the lawyers’ provident institution, there is the possibility of being exonerated, under certain conditions, from compulsory membership of that institution, which the applicant in the main proceedings did not seek to do, does not call into question the existence of a direct link between the expenses and the activity which generated the income.
            
         
               40
            
            
               First, the fact that the applicant in the main proceedings should have undertaken certain steps in order to avoid the payment of contributions to that institution, assuming that that was possible, which the applicant in the main proceedings contested before the Court, tends rather to show that the activity of a lawyer in question in the case in the main proceedings ordinarily generates that type of expense.
            
         
               41
            
            
               Second, the fact that the applicant in the main proceedings may have been able to avoid such expenses cannot alter their characterisation. The existence of a direct link, within the meaning of the case-law set out in paragraph 33 above, does not mean that an expense must be unavoidable. Thus, it was held that there was a direct link in respect of costs involved in obtaining tax advice for the purpose of preparing a tax return, since the duty to file such a tax return results from the fact of receiving income in the Member State in question (judgment of 6 July 2006, Conijn, C‑346/04, EU:C:2006:445, paragraph 22).
            
         
               42
            
            
               The existence of a direct link, within the meaning of the case-law set out in paragraph 33 above, results from the fact that the expense is inextricably linked to the activity which gives rise to that income (judgments of 31 March 2011, Schröder, C‑450/09, EU:C:2011:198, paragraph 43, and of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 36). As has been stated in paragraph 37 above, the payment of the contributions to the lawyers’ provident institution is necessary on account of membership of the bar association, which is itself necessary in order to carry on the activity which generated the taxable income.
            
         
               43
            
            
               Next, the fact on which the defendant in the main proceedings and the German Government relied that the contributions at issue in the main proceedings are alleged not to be principally concerned with practising as a lawyer in Germany, but with the acquisition of rights for the purpose of ensuring means of subsistence in old-age, which — it is argued — proves that they relate to the personal and family circumstances of the taxable person, does not change their characterisation as expenses incurred which are directly related to the income at issue in the main proceedings in so far as, objectively speaking, the expenses are necessary in order to receive that income.
            
         
               44
            
            
               Lastly, the facts at issue in the main proceedings differ from those at issue in the case which gave rise to the judgment of 22 June 2017, Bechtel (C‑20/16, EU:C:2017:488), and the findings made by the Court in that judgment as regards the refusal to grant a resident taxpayer the advantages arising from his or her personal and family circumstances being taken into account in the form of deductions of additional pension and health insurance contributions, paid in the Member State of employment, cannot be applied to the issue of taking into account, in the Member State where an activity is carried out, compulsory contributions to an occupational pension scheme. In the case which gave rise to the judgment cited, the issue of whether expenses in the form of pension contributions are directly linked to the activity which generated the taxable income did not need to be examined.
            
         
               45
            
            
               The Court therefore finds that the compulsory contributions to the lawyers’ provident institution are directly linked to the activity which generated the taxable income in Germany.
            
         
               46
            
            
               It should, however, be noted, in that regard, as has been stated in paragraph 36 above, that registration with the Cologne Bar Association was necessary in order for the applicant in the main proceedings to be able to practise, as a Rechtsanwalt, not only in Germany, but also in Belgium. Furthermore, it is stated in the order for reference that the applicant in the main proceedings also practised in other countries without specifying whether they are other Member States or whether he practised as a Rechtsanwalt.
            
         
               47
            
            
               Accordingly, the compulsory contributions to the lawyers’ provident institution are also directly linked to the activity which generated the taxable income in Belgium and, potentially, in other Member States.
            
         
               48
            
            
               As opposed to the income of a resident taxable person, subject in Germany to unlimited liability to tax, a non-resident taxable person is subject in that Member State only to a limited tax liability for the income generated in that Member State.
            
         
               49
            
            
               It follows that, as regards the compulsory contributions to the lawyers’ provident institution, the situation of a non-resident taxable person, such as the applicant in the main proceedings, should be regarded as comparable to that of a resident taxable person as regards the share of the contributions paid which corresponds, proportionally, to the share that the taxable income in Germany represents in the total income generated by the activity in question.
            
         
               50
            
            
               Accordingly, a difference between the situation of resident taxable persons and that of non-resident taxable persons cannot legitimately be relied on in the case of a restriction, such as that at issue in the main proceedings, which follows from the refusal to deduct compulsory contributions to the lawyers’ provident institution, in due proportion to the share of the income taxable in Germany.
            
         
               51
            
            
               As regards, in the second place, the voluntary contributions to the lawyers’ provident institution, it is clear from the order for reference that those expenses are based on a free decision of the applicant in the main proceedings to increase his pension entitlement to the extent of the maximal amount authorised for contributions.
            
         
               52
            
            
               In that regard, although the expenses also result from membership of the bar association, they do not, contrary to the compulsory contributions, necessarily result from such membership. They are not therefore necessary in order to practise as a lawyer in Germany or to receive the taxable income in Germany.
            
         
               53
            
            
               Accordingly, as regards the additional contributions to the lawyers’ provident institution, a non-resident taxable person, such as the applicant in the main proceedings, is not in a situation comparable to that of a resident taxable person.
            
         
               54
            
            
               That finding cannot be called into question by the argument that pensions paid by the lawyers’ provident institution will, at a future time, be taxable in Germany. Aside from the uncertainty of such future taxation, suffice it to note that the case in the main proceedings concerns the taxation of income generated in Germany by the applicant in the main proceedings practising as a lawyer and that, in order for such expenses to be deducted in the framework of that taxation, they must be directly linked to the activity which generated that income. An uncertain link with other future income is not relevant for the purposes of ascertaining whether such a direct link exists.
            
         
               55
            
            
               In the third place, as regards the amount paid into a private pension scheme, the Courts finds, as did the referring court, that there is no direct link between those expenses and the activity of practising as a lawyer which generated the taxable income.
            
         
               56
            
            
               For reasons similar to those set out in paragraph 54 above, an uncertain link with other future income is not relevant in ascertaining whether an amount paid into a private pension scheme is directly linked to the income generated in Germany by the activity of the applicant in the main proceedings.
            
         
               57
            
            
               The Court therefore finds that, as regards the amount paid into a private pension scheme, a non-resident taxable person, such as the applicant in the main proceedings, is not in a situation comparable to that of a resident taxable person.
            
         
               58
            
            
               Accordingly, a difference between the situation of resident taxable persons and that of non-resident taxable persons may legitimately be relied on in the case of a restriction, such as that at issue in the main proceedings, which follows from the refusal to deduct additional contributions to the lawyers’ provident institution and the amount paid into a private pension scheme.
            
         
         
            Justification
         
      
      
               59
            
            
               It should also be ascertained whether the restriction on the freedom of establishment, resulting from the refusal to deduct compulsory contributions to the lawyers’ provident institution, in due proportion to the share of the income taxable in Germany, can be justified by overriding reasons of general interest.
            
         
               60
            
            
               In that regard, the defendant in the main proceedings claims that the refusal to deduct the contributions is justified by reasons related to the risk that the contributions would also be deducted in Member States other than the Federal Republic of Germany, which would confer on the taxable person several unjustified advantages. According to the defendant in the main proceedings, the taxable person should be required to prove that those contributions did not lead to further tax advantages in the Member State of residence of the taxable person.
            
         
               61
            
            
               In relying without further explanation on that risk, the defendant in the main proceedings has not enabled the Court to assess the implications of that argument when it has not been claimed that that risk could not have been avoided through the application of Council Directive 77/799/EEC of 19 December 1977 concerning mutual assistance by the competent authorities of the Member States in the field of direct taxation (OJ 1977 L 336, p. 15), as amended by Council Directive 2006/98/EC of 20 November 2006 (OJ 2006 L 363, p. 129), in force at the time (see, also, judgment of 24 February 2015, Grünewald, C‑559/13, EU:C:2015:109, paragraph 52).
            
         
               62
            
            
               Having regard to all the foregoing considerations, the answer to the questions referred must be that:
               
                        –
                     
                     
                        Article 49 TFEU must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, under which a non-resident taxable person, subject, in that Member State, to income tax in the framework of limited tax liability, cannot deduct from the income tax basis of assessment the amount of compulsory contributions paid into an occupational pension scheme in due proportion to the share of the income taxable in that Member State if directly linked to the activity which generated that income, whereas a resident taxable person, subject to income tax in the framework of unlimited tax liability, can deduct such contributions from the income tax basis of assessment to the extent laid down by national law, and
                     
                  
                        –
                     
                     
                        Article 49 TFEU must be interpreted as not precluding legislation of a Member State, such as that at issue in the main proceedings, under which a non-resident taxable person, subject, in that Member State, to income tax in the framework of limited tax liability, cannot deduct from the income tax basis of assessment the amount of additional contributions paid into an occupational pension scheme or the amount of contributions paid into a private pension scheme, whereas a resident taxable person, subject to income tax in the framework of unlimited tax liability, can deduct such contributions from the income tax basis of assessment to the extent laid down by national law.
                     
                  
         
         Costs
      
      
               63
            
            
               Since these proceedings are, for the parties to the main proceedings, a step in the action pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.
            
          
            
               On those grounds, the Court (Tenth Chamber) hereby rules:
            
          
               
                  
                     Article 49 TFEU must be interpreted as precluding legislation of a Member State, such as that at issue in the main proceedings, under which a non-resident taxable person, subject, in that Member State, to income tax in the framework of limited tax liability, cannot deduct from the income tax basis of assessment the amount of compulsory contributions paid into an occupational pension scheme in due proportion to the share of the income taxable in that Member State if directly linked to the activity which generated that income, whereas a resident taxable person, subject to income tax in the framework of unlimited tax liability, can deduct such contributions from the income tax basis of assessment to the extent laid down by national law.
                  
               
             
               
                  
                     Article 49 TFEU must be interpreted as not precluding legislation of a Member State, such as that at issue in the main proceedings, under which a non-resident taxable person, subject, in that Member State, to income tax in the framework of limited tax liability, cannot deduct from the income tax basis of assessment the amount of additional contributions paid into an occupational pension scheme or the amount of contributions paid into a private pension scheme, whereas a resident taxable person, subject to income tax in the framework of unlimited tax liability, can deduct such contributions from the income tax basis of assessment to the extent laid down by national law.
                  
               
             
               
                  
                     [Signatures]
                  
               
            (
            *1
         )	Language of the case: German.