News on loss carryforwards in cases involving tax groups: Focus on Sections 8c and 8d of the German Corporation Tax Act (KStG)

The application of Section 8c of the German Corporation Tax Act (KStG) to fiscal units raises numerous unresolved (and, in the highest courts, unclarified) questions. In its ruling of December 9, 2024 (6 K 1772/20 K,G,F), the Düsseldorf Fiscal Court decided that in the event of a detrimental change of shareholders during the year, the proportionate loss of a controlled company during the year is not lost under Section 8c KStG, but rather an interim consolidation with the income of the controlling company must be carried out. This article highlights the main arguments and the implications for trade tax. In addition, the Düsseldorf Fiscal Court denied the applicability of Section 8d KStG in the case of multi-level fiscal units.