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Exit taxation: What you should know about the tax aspects of moving abroad Tax consequences and structuring options for individuals and companies

A move abroad not only brings organizational and cultural challenges, but also tax aspects. Withdrawal taxation plays an important role, both for individuals and companies. It is crucial to clarify the tax consequences at an early stage and to examine structuring options. Experienced tax advisors can provide support in taking advantage of tax benefits.

When planning a move abroad, the tax aspects should be carefully considered. Exit taxation is a procedure used in many countries to ensure that taxpayers continue to meet their tax obligations after changing their residence. With exit taxation, the taxpayer’s assets are valued on a certain date, and a tax is calculated from this. This tax can be paid either all at once or in installments, depending on the laws of the country of origin.

It is advisable to find out about the tax consequences of moving away at an early stage and to consider suitable structuring options. In some countries, there are special regulations and incentives for taxpayers who wish to move their residence abroad. These may include, for example, tax breaks for certain activities or investments. An experienced tax advisor can help you find the best solutions for your individual situation and take advantage of tax benefits.

From practice

Mr. Müller, a German citizen, decides to move his residence to Spain to spend his retirement there. Before his move, he should carefully examine the tax implications of this step. With the help of a specialized tax advisor, he can find out whether he is subject to exit taxation and how high his potential tax liability could be. The tax advisor will also check whether there are any special regulations in Spain that could offer Mr. Müller tax advantages. Together, they work out an individual tax strategy to minimize tax burdens. For example, they might consider whether it makes sense to sell certain assets before the move or take tax-optimizing measures.


Withdrawal taxation can vary depending on the country and individual situation. An experienced tax advisor with expertise in international tax law can help understand the specific rules of the country of origin and destination and take appropriate action. This could include, for example, the use of double taxation treaties to avoid double taxation or the consideration of tax benefits in the destination country.

Particular importance is attached to Section 6 of the Foreign Tax Act, which governs the taxation of capital gains upon departure from Germany. According to this paragraph, certain assets, such as shares in corporations, may be subject to taxation upon departure from Germany. A specialized tax advisor can assist in the application of this paragraph and analyze the tax consequences for the taxpayer.

It is important to note that the tax aspects of exit taxation may vary from country to country. Each country has its own regulations and laws regarding departure and related taxation. Therefore, it is advisable to consult with a specialized tax advisor at an early stage to review the individual situation and the best tax planning options.

Overall, exit taxation is a complex issue that should be considered carefully in order to minimize tax risks and take advantage of tax benefits. Working with an experienced tax advisor who specializes in international tax law is critical to obtaining sound advice and developing a customized tax strategy that complies with legal requirements and best supports the taxpayer.

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