Participation in the holding company | Participation in the operating company (GmbH)
Person A: 30% | Person A: 0%
Person B: 70% | Person B: 0%
Person C: 0 % | Person C: 100 %
An operating split exists when there are material and personnel links between an operating and a holding company. One person or group of people must therefore control both companies and exercise a uniform will to do business here. But when are the interests of the same kind involved in a business split and when are they to be rejected?
1. The main principles of division of operations
The division of operations is a legal institution developed by the Bundesfinanzhof (BFH), which is not regulated by the Income Tax Act. If there is a business split, it causes commercial “infection” in the principle of private income. Rental income thus becomes commercial income, for example, because the case law assumes a single commercial enterprise.
In essence, two requirements apply here:
This article does not replace tax or legal advice in an individual case. Facts, current law, jurisdiction, documentation and implementation remain decisive.