Redemption of company shares: Pay attention to gift tax!

Sections 3 and 7 of the German Inheritance Tax Act (ErbStG) treat a large number of transactions under company law as taxable acquisitions. The relevant provisions are repeatedly the focus of case law and must always be taken into account when drafting partnership agreements, in particular since an intention to make a donation is often not a prerequisite. In a recently published ruling dated November 17, 2021 (II R 21/20), the BFH has now decided that not only the compulsory redemption of a GmbH share in exchange for compensation below value constitutes a gift, but also the redemption by mutual consent.