May profits earned by a German company holding shares in a corporate enterprise located in the UAE be transferred tax-free to Germany?
The DTA also yields interesting options for dividend earnings, which are the result of a German company holding a legal share of a company in the UAE. If the parent company is a German corporation with a direct share in a corporation located in the UAE of at least 10%, dividend payouts of the company located in the UAE to the German parent company are never subject to German taxation. However, this applies only under the condition that the corporation located in the UAE is active according to the definitions of the DTA and the German International Taxation Law. For example, an active activity in the area of trade does not exist if the German company supplies goods to company located in the UAE in which it has a share itself. This basically applies to distribution companies of German corporations if these hold a share in such a distribution company located in the UAE. However, the prerequisites of an active activity according to Article 8 Paragraph 1 No. 4 AStG have been met if, in case
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