Friday, 24 February 2017

CJEU rules Danish interest exemption rules violate EU law

The Court of Justice of the European Union (CJEU) issued its decision in the Masco Denmark case on 21 December 2016, concluding that certain Danish rules on the tax treatment of interest income are incompatible with the freedom of establishment provision in the Treaty on the Functioning of the European Union (TFEU). Under Danish corporate law, a tax exemption is granted for interest received on a loan granted by a Danish company to its Danish affiliate if a corresponding interest deduction is denied at the level of the debtor as a result of the application of the thin capitalization rules. Notably, the CJEU declined to follow the opinion of Advocate General (AG) Kokott issued on 12 May 2016.

Source & more info: Deloitte