Directive 2011/96 - Common system of taxation applicable in the case of parent companies and subsidiaries of different Member States (recast) - Main contents
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official title
Council Directive 2011/96/EU of 30 November 2011 on the common system of taxation applicable in the case of parent companies and subsidiaries of different Member States (recast)| Legal instrument | Directive |
|---|---|
| Number legal act | Directive 2011/96 |
| Original proposal | COM(2010)784  |
| CELEX number i | 32011L0096 |
| Document | 30-11-2011 |
|---|---|
| Publication in Official Journal | 29-12-2011; OJ L 345, 29.12.2011,Special edition in Croatian: Chapter 17 Volume 002 |
| Effect | 18-01-2012; Entry into force Date pub. +20 See Art 10 |
| End of validity | 31-12-9999 |
| Transposition | 18-01-2012; At the latest See Art 8 |
29.12.2011 |
EN |
Official Journal of the European Union |
L 345/8 |
COUNCIL DIRECTIVE 2011/96/EU
of 30 November 2011
on the common system of taxation applicable in the case of parent companies and subsidiaries of different Member States
(recast)
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular Article 115 thereof,
Having regard to the proposal from the European Commission,
After transmission of the draft legislative act to the national parliaments,
Having regard to the opinion of the European Parliament (1),
Having regard to the opinion of the European Economic and Social Committee (2),
Acting in accordance with a special legislative procedure,
Whereas:
(1) |
Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent companies and subsidiaries of different Member States (3) has been substantially amended several times (4). Since further amendments are to be made, it should be recast in the interests of clarity. |
(2) |
In the light of the judgment of the Court of Justice of 6 May 2008 in Case C-133/06 (5), it is considered necessary to redraft the wording of the second subparagraph of Article 4(3) of Directive 90/435/EEC, for the purpose of clarifying that the rules referred to therein are adopted by the Council acting in accordance with the procedure provided for in the Treaty. It is furthermore appropriate to update the Annexes to that Directive. |
(3) |
The objective of this Directive is to exempt dividends and other profit distributions paid by subsidiary companies to their parent companies from withholding taxes and to eliminate double taxation of such income at the level of the parent company. |
(4) |
The grouping together of companies of different Member States may be necessary in order to create within the Union conditions analogous to those of an internal market and in order thus to ensure the effective functioning of such an internal market. Such operations should not to be hampered by restrictions, disadvantages or distortions arising in particular from the tax provisions of the Member States. It is therefore necessary, with respect to such grouping together of companies of different Member States, to provide for tax rules which are neutral from the point of view of competition, in order to allow enterprises to adapt to the requirements of the internal market, to increase their productivity and to improve their competitive strength at the international level. |
(5) |
Such grouping together may result in the formation of groups of parent companies and subsidiaries. |
(6) |
Before the entry into force of Directive 90/435/EEC, the tax provisions governing the relations between parent companies and subsidiaries of different Member States varied appreciably from one Member State to another and were generally less advantageous than those applicable to parent companies and subsidiaries of the same Member State. Cooperation between companies of different Member States was thereby disadvantaged in comparison with cooperation between companies of the same Member State. It was necessary to eliminate that disadvantage by the introduction of a common system in order to facilitate the grouping together of companies at Union level. |
(7) |
Where a parent company by virtue of its association with its subsidiary receives distributed profits, the Member State of the parent company must either refrain from taxing such profits, or tax such profits while authorising the parent company to deduct from the amount of tax due that fraction of the corporation tax paid by the subsidiary which relates to those profits. |
(8) |
It is furthermore necessary, in order to ensure fiscal neutrality, that the profits which... |
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