Beskatning af livsforsikringsselskaber: En analyse af den finansielle sektors øgede skattebyrde og forholdet til den skatteretlige omgåelsesklausul

Oliver Langkilde Bladmose

Student thesis: Master executive thesis

Abstract

The Social Democratic Party introduced during the election campaign in 2019 a new political retirement reform New right to early retirement. The reform allow workers with 42 years or more of employment by age 61 to be eligible to the
public pension scheme (folkepension) up to 3 years before the normal retirement age, which is 67. The new pension scheme is aimed for lower-skilled blue-collar workers who tend to enter the jobmarket earlier and have more physically
demanding professions. In 2020 the Danish Parliament enacted the New right to early retirement reform, which were to be financed through a rollback of previous tax cuts, change in principle of taxation for real estate and higher taxation of financial institutions. During the summer of 2022, the Danish Parliament enacted a change of the Danish Corporate Tax Act by introducing a
new corporate income tax rate for financial institutions being 25.2% (2023) and 26% (2024). The new legislation was only supposed to tax financial institutions by their financial activities, however the increased corporate tax rate applied to the entire taxable income of the relevant legal entities. This could lead to taxation of nonfinancial activities if the current legal entity also has non-financial activities. The Danish Ministry of Taxation comments in the prelimimaries of the new legislation, that it is possible to carve-out the non-financial activities through a tax free restructuring into a separate legal entity.
The prelimimaries of the new legislation explicitly states, that the anticipated tax free restructuring would not be subject to the General anti-avoidance rule (”GAAR”) originating from the Anti Tax-Avoidance Directive (“ATAD”) implemented in the Danish Tax Assessment Act section 3. This led to a variety of discussions between the Danish Ministry of Taxation and relevant stakeholders including tax advisors, non-governmental organizations representing the Danish financial industry and the politicial opposition. This master thesis analyze the new legislation in the light of commercial life insurance companies1 and demonstrates the tax implications for their underlying investments relating to commercial real estate. This involves analyzing the commercial life insurance companies’ options to avoid the increased tax burden for their underlying commercial real estate investments. Further, the master thesis include an analysis of the anticipated tax free restructuring in the light of the GAAR in order to verfify the Danish Ministry of Taxation’s proposal. The overall conclusion is that the increased tax burden affects the commercial life insurance companies’ underlying real estate investments. This is due to the Danish deduction limitation rules applying for life insurance companies2. It is possible to conduct the anticipated tax free restructuring within the applicable law of the GAAR. However, the tax free restructuring’s effect on the effective taxation of the real estate activities is limited to the real estate operations (including rent etc.). The gains related to the appreciation of the underlying property are still included in the taxable income of the commercial life insurance company, which is due to the Danish deduction limitation rules.

EducationsMaster i Skat, (Executive Master Programme) Final Thesis
LanguageDanish
Publication date2022
Number of pages41
SupervisorsPeter Koerver Schmidt