Field help: Were shares transferred free of charge?

In this section, you should specify whether shares in corporations, cooperatives, opting companies in accordance with sect. 1a of the Corporate Tax Act (KStG) or subscription rights were transferred free of charge. This information is important because the tax authorities check for special tax issues in such cases.

What does "transfer free of charge" mean?

A transfer is considered to be free of charge if shares or subscription rights are transferred without consideration, for example:

• Gift
• Inheritance
• Transfer free of charge within the family

How to proceed:

• Check whether shares or subscription rights were transferred free of charge in the relevant tax year.
• If "yes", please provide the following information in the explanatory field:
• Type of shares or rights transferred (e.g. GmbH shares, cooperative shares, subscription rights)
• Recipient of the transfer (e.g. relative, third party)
• Reason for the transfer (e.g. gift or inheritance)
• Have a separate list ready in case the tax office requires additional information.

Examples of relevant information:

1. During the tax year, shares in a limited liability company with a value of 50.000 Euro were transferred to the son as a gift.
2. In the case of inheritance, the mother's shares in the cooperative were transferred to the daughter.
3. Subscription rights to new shares were passed on to the spouse free of charge.

Legal basis:

This information is required by the tax authorities because special tax regulations must be taken into account for transfers free of charge, for example:

• sect. 17 of the Income Tax Act (EStG): Taxation of capital gains on shares in corporations.
• sect. 7 of the Inheritance and Gift Tax Act (ErbStG): Valuation and taxation of gifts.
• sect. 1a of the Corporation Tax Act (KStG): Rules on opting companies.