Rekonstruktion: Skattemæssige konsekvenser ved rekonstruktion af selskaber

Kristine Torma

Student thesis: Master thesis


The purpose of this thesis is to describe the tax consequences of the current regulation concerning the reconstruction of insolvent companies. The new legislation on reconstruction in the Danish Bankruptcy Act is focused on how to help companies, which are viable, but temporarily insolvent, stay in business. It is also possible to combine a reconstruction within the frame of this act with other financial measures, such as a debt conversion. The thesis focuses on a few special problems concerning reconstruction from a fiscal point of view. The new legislation on reconstruction has been implemented without a corresponding amendment of the tax laws. This has resulted in an uncertain legal position regarding the tax consequences of entering insolvency proceedings. If the company is under joint taxation with several other allied companies, there may be a problem, if the reconstructor takes over the management of the company. In the new legislation this is a possibility, if a creditor applies for the insolvency proceedings and not the company. Also the judicial decisions concerning the tax exemption of cancellation of debt if more than half of the creditors participate have led to more stringent requirements, if the cancellation of the debt is to be tax free. If the company and the creditors plan a debt conversion it may be possible to deduct the loss concerning the entire debt, even though only a part of the debt is converted. A new decision by the Eastern Division of the High Court makes this possible. This way the creditor can have the full tax allowance, even if the rest of the debt is now at par value. When companies are part of a joint taxation, there are many aspects, which an advisor needs to be aware of. The community of interest between the allied companies can result in dispositions with the purpose of tax avoidance. Therefore it is necessary to make sure, that all the special rules concerning allied companies are respected. Planning the reconstruction can be difficult with all these considerations. The advisor needs to tailor the reconstruction to the individual company in order to make sure that the best result is achieved from both a financial and fiscal point of view. But there is a clear need for the regulation to be clarified, especially concerning allied companies. At the moment some of the legislation and judicial decisions make it hard to find the optimal solution, when the long-term consequences are not yet clear.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
Publication date2012
Number of pages83