Teilversenkter

Teilversenkter is a term used in the context of German tax law, specifically within the framework of corporate taxation. It refers to a situation where a company's profits are partially offset by losses incurred in other tax jurisdictions. This concept is relevant for multinational corporations that operate in multiple countries and are subject to different tax regulations.

In Germany, the tax authorities apply a specific set of rules to determine the taxable profit of a company. One of these rules is the "Teilversenker" rule, which allows for the partial offset of profits with losses from other countries. This can result in a reduced taxable profit, thereby lowering the amount of corporate tax that the company is required to pay.

The application of the Teilversenker rule is subject to certain conditions and limitations. For instance, the losses must be genuine and not the result of tax planning or avoidance strategies. Additionally, the rule is typically applied on a consolidated basis, meaning that the losses of subsidiary companies can be offset against the profits of the parent company.

The Teilversenker rule is part of Germany's efforts to ensure that multinational corporations do not exploit tax loopholes to reduce their overall tax burden. By allowing for the partial offset of profits with losses from other countries, the rule aims to create a more level playing field for domestic and foreign companies alike.