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Remote Work: This tax trap threatens when moving abroad

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Remote Work: This tax trap threatens when moving abroad

Never base your life situation on the taxes you have to pay, but rather the taxes on your life situation. Otherwise there is a risk of a tax trap. Getty Images

Mirco Zantopp is a lawyer and tax advisor at PXR, a full-service law firm for startups in the technology industry. He has already advised companies such as Vay and Knowunity on various tax law issues.

Home office and remote work are now part of the reality of many companies and the place of work increasingly rarely defines one’s place of residence. While this development is already affecting many employees, more and more founders are now deciding to move abroad and continue their business in Germany from there. What many people don’t take into account, however, is the exit tax.

What is exit tax?

To put it simply, exit taxation stipulates that the shares held by entrepreneurs in a capital company (e.g. GmbH or AG) are “fictitiously” sold as soon as the place of residence is moved abroad and the founder has at least one percent of the company’s shareholding or was involved within the last five years before moving away.

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