The costs of renting a trade fair area can only result in additional charges to the exhibitor if the trade fair area will belong to the exhibitor’s fixed assets if it is assumed to be owned by the exhibitor. Affiliation with fixed assets depends on whether the business purpose of the company in question as well as special operating conditions require the permanent availability of the corresponding exhibition area.
Background: Adding trade tax to booth space rental expenses
The plaintiff is an LLC whose goal is to develop, manufacture and sell … the LLC itself has no direct sales; It sells its products through a well-established dealer network. In the years of conflict 2009 to 2011 rented It is repeated in some ordinary events Measuring exhibition spaces and buildingsto present their products there. This resulted in annual expenses of €96,758 (2009), €78,174 (2010) and €105,264 (2011). I dealt with the effort as Deductible business expenses; One Addition of trade tax for part of the rent in accordance with Article 8 No. 1 letter e GewStG not explained.
After conducting an external audit for the disputed years from 2009 to 2011, the Tax Office (FA) came to the conclusion that expenses in accordance with §8 No. 1 letter e GewStG should be added to the business profit. The FA dismissed the objection to the revised commercial tax assessment notices as unfounded.
FG has upheld GmbH’s claim
The lower tax court upheld the lawsuit against this, in which the LLC sought to change the trade tax metrics in such a way that the additional amounts resulting from the rental of exhibition stand space were omitted.
Decision: The BFH considers the FA review to be unfounded
In the opinion of the BFH, the Lower Tax Court correctly interpreted the addition clause in Section 8 #1, letter e GewStG. Therefore, the FA’s review is unfounded.
Pursuant to Section 8 No. 1 letter e GewStG, 13/20 quarter (2009) or half rent and lease interest (2010, 2011) – including rental rates – for the use of fixed assets for fixed assets owned by another addedin so far as they have been deducted when determining the profit and to the extent that the sum of the amounts within the meaning of Section 8 No. 1, the letters A to and GewStG exceeds €100,000.
Concept Fixed assets It is – as FG rightly supposes – to be determined according to the principles of general income tax. According to this, fixed assets are things that are meant To serve the company in the long term (Article 247 Paragraph 2 HGB). These are the assets intended for use in the company. On the other hand, current assets include economic goods intended for immediate consumption or sale.
There are no virtual fixed assets
To add according to Article 8 GewStG, it is necessary to determine whether economic goods capital assets of the lessee or the lessee will be If it is his. this is imagination It is due to the purpose of Article 8 No. 1, the letter e GewStG, to determine the objective income of the business enterprise by addition in the sense of neutrality of financing.
FG has taken into account the business purpose of the GmbH and orientated itself as much as possible to the operating conditions. Based on the business purpose of the GmbH, which is limited to production companyt, it has been proven that they do not sell manufactured products directly to end users, but rather sell them through third parties A permanent network of merchants was sold indirectly. So the purpose of the company is required There is no mandatory participation in the trade fair.
This estimate of the FG that the plaintiff, taking into account the business and distribution channels on Do not depend on the constant availability of booth spaceParticipation in trade fairs was useful for selling products but not essential to the process, and is at least possible and thus binding on the Senate.
FA correctly indicates that short-term leases can also result in the acceptance of fixed assets. However, this does not mean that every short-term lease of movable or immovable property necessitates acceptance of fixed assets. Classification as fixed assets is of particular importance if the taxpayer Frequently rents similar assets It follows that he has such assets Constantly required for use in his company. However, in this case, the plaintiff was related to the existing sales structure and other advertising opportunities Don’t constantly rely on providing booth space for use in your company.
BFH, Resolution 23 March 2022, III R 14/21; Published on 23.6.2022
All BFH decisions were published on June 23, 2022 with short comments