National samt international sambeskatning

Abstract

The title of this thesis is "National and international joint taxation". The thesis is examining: • The regulation regarding of national and international joint taxation • Consequences of entering national and international joint taxation • Advantages and disadvantages of joint taxation • How to value advantages and disadvantages? When national joint taxation became mandatory in 2005, the regulation concerning international joint taxation changed too. It is still voluntary for a parent company to decide, whether to include a foreign subsidiary or not into Danish joint taxation. The major change is that, if the parent company chooses to include a foreign subsidiary into joint taxation, it will have to include all foreign subsidiaries for a compulsory penad at 10 years. With the tendency of a more globalized world, the decision of whether to enter into an international joint taxation or not have become more complex, and should require a strategy of entry and exit into joint taxation in order to asses and validate the expected advantages and disadvantages of a potential joint taxation of the group. This thesis includes a demonstration of how taxable income and losses are distributed and used in a group with national joint taxation and international joint taxation. The thesis also includes a model for tax planning in regards to international joint taxation and a matrix. The thesis analyzes advantages and disadvantages of joint taxation as well as how a joint taxation is administered. The conclusion of the thesis is; • The national Danish joint taxation offers a group the possibility to deduct losses in a subsidiary in the income statement of the group. In order to gain advantage from an international joint taxation, it is important that the losses from the foreign subsidiaries occur at the beginning of the ten year compulsory budget period. It is only interesting if there are losses in the foreign subsidiaries. Otherwise, at best the effect of international joint taxation will be neutral, at worst it will increase the groups payable taxes. • The national tax rate in the country of the foreign subsidiary should not be much lower than the Danish tax rate. • The group must lay a strategy regarding future acquisitions of subsidiaries. The model in the thesis includes one subsidiary and the theoretically expected performance of this. It is obvious that the more subsidiaries that are included in the model for the group, the more complex and difficult the process becomes.