Filing Obligations, Tax Assessment and Tax Collection after a Merger or Split-up - Tax Administration Provides Guidance

Profession:Van Bael & Bellis
 
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TAXATION

In a Circular dated 1 December 2010 (Circular AOIF 70/2010, Ci. RH. 81/600.928), the tax administration provides guidance on the tax return filing obligations, the tax assessment and the tax collection after a merger or split-up.

Filing obligations

In the cases where the transaction results in the dissolution of a company without liquidation, the acquiring company is obliged to file a tax return for the dissolved company relating to the period until the effective date of the transaction. The competent tax authority of the dissolved company remains competent for the verification and assessment of the income of the dissolved company. The filing must be done within one month after the date the shareholders of both companies have formally agreed to the transaction, and in any case no later than six months after the effective date of the transaction.

Tax assessment

The tax assessment of the dissolved company will be addressed to the acquiring company within the normally applicable time periods.

Tax collection in case of a split-up

In the case of a split-up, the collection of taxes from each of the acquiring companies is based on the pro rata part of the net assets of the split-up company allocated to each of the acquiring companies, unless the split-up deed provides otherwise. The tax administration therefore recommends that in the case of a split-up the acquiring companies provide the tax authorities with the following information: (i) their respective part of the tax due by the split-up company (in principle based upon the acquired net assets), and (ii) their respective bank account number. Finally, the tax administration adds to the circular a standard form to be used for that purpose.

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