BMF-Erlaß zur internationalen Personalentsendung

On February 16, 1998 the Ministry of Finance issued an instruction clarifying the tax treatment of international assignment of personnel within multinational enterprises. According to the instruction only domestic law, which is based on the principle of "freedom of contract" („Gestaltungsfreiheit"), can decide who has to be treated as employer for tax purposes in the case of intercompany manpower-leasing contracts and other assignments. It is set out in the instruction that solutions under...