Worth knowing Personal success factors for contributions according to Art. III UmgrStG [Reorganisation Tax Act]

According to the case law of the Administrative Court, the earnings potential (or the resulting firm or practice value) of a consulting firm based solely on the personal characteristics of the business owner, such as personal reputation or prominence, is not transferable to third parties and therefore not to be taken into account in the determination of market value pursuant to § 12 para. 1 UmgrStG. In order to ensure that the incorporation of such companies into a limited liability company falls under the privileges of Art III UmgrStG , a positive market value of the contributed assets must be available, excluding personal success factors.

See also Business continuity in crisis – arithmetical over-indebtedness (Rabel) .