BFH confirms company-related control requirement for the switching clause pursuant to Section 20 (2) German Foreign Tax Act (AStG)

With its ruling of 8 April 2025 (IX R 32/23), the BFH has clarified the situation: contrary to the previous opinion of the tax authorities, the application of the switching clause in accordance with section 20 para. 2 AStG is based on company-related control and not shareholder-related control. The ruling therefore significantly restricts the scope of application. You can read more about the decision and an outlook on possible further implications of the ruling in the first part of this two-part article.