Editorial

Dear Readers,

We hope you had a relaxing holiday and are now ready to start the busy last third of the year with renewed vigour. Our first report in the Tax section discusses the interesting option opened up by the Federal Fiscal Court with respect to succession planning where the aim is to retain the knowledge carriers in the business for the long term. This is then followed by some guidance as to the classification of upkeep expenses for tax purposes. Here, acquisition-related production costs could turn out to be tax traps when acquiring property in need of renovation.

Our first contribution in the Accounting and Finance section has been selected as our Key Issue report for this September edition of our magazine. Here we discuss the new requirements of the IFRS standard setter that should ensure more transparency for financial reporting in the future. The effect of these requirements is also likely to spread to financial statements prepared in accordance with the German Commercial Code (HGB). A further accounting issue relates to the determination of income for a foreign partnership that, under certain circumstances, will have to gear up for the transition to the mandatory keeping of accounts and preparation of financial statements.

In the first report in our Legal section, you can read about a legislative amendment under which the formal requirement for the conclusion of commercial lease agreements has been relaxed; consequently, termination options that have hitherto been available will cease to apply. Furthermore, in the interests of their businesses, entrepreneurs should put in place contractual arrangements to govern their matrimonial relationships. In doing so, certain guidelines need to be observed so that, if the worst comes to worst, the contracts are not rejected on account of unconscionability. 

The short reports in this edition cover a broad range of issues that span tax thresholds and include the new minimum wage amounts, the definition of fictitious self-employment and the recognition of wills.

We wish you an interesting read that is of great use. 
Your PKF Team