Audit-oriented structuring, strategic preparation and expert support through all phases of a German tax audit — senior-led.
Seven years in audit at PwC Germany shaped Irina Dallman's understanding of how processes, contracts, figures and documentation are assessed from an auditor's perspective. She brings this experience into tax structuring and the preparation and support of German tax audits. The goal: to structure tax positions clearly, identify risks early, and build documentation that can withstand later scrutiny.
- Early identification of tax risks before an audit is announced
- Development of a coherent tax position for the full audit phase
- Preparation of contracts, calculations and documentation
- Professional communication with the auditor
- Coordination with lawyers and specialist advisers
- Support through fact-finding and closing discussions
- Critical review of all audit findings and appeal options
- Preventive audit-oriented structuring
- Transfer pricing and cross-border matters in the audit
- Audit support following acquisitions or restructurings
German tax advice for international shareholdings, operations, financing and investments.
- Double tax treaties
- Permanent establishments
- Withholding taxes
- Holding and ownership structures
- Cross-border restructurings
- International distributions
- Coordination with local trusted partners
- Location and country selection
Cross-border VAT for international business models.
- Cross-border supplies of goods and services
- EU registrations
- Warehouses and goods movements
- E-commerce and online sales
- Import/export interfaces
- VAT processes and reporting
German reporting in an international group context.
- German reporting packages
- HGB reporting
- Interfaces with IFRS or US-GAAP
- Tax accounting and reconciliation
- Coordination with group finance teams and auditors
Advice on strategic decisions at shareholder level – in particular on international relocation, German exit taxation, ownership structures, succession and exit. Dallman brings particular expertise and extensive practical experience to these matters.
- Planning international relocation
- German exit taxation and its tax consequences
- Ownership and holding structures before and after relocation
- Tax residence and double tax treaties
- Distributions and cross-border income
- Succession, sale and exit planning
- Coordination with lawyers and tax advisers in the countries concerned
A transfer-pricing model aligned with the operating business and designed to withstand subsequent tax scrutiny.
- Intra-group pricing models
- Functions, risks and value creation
- Intra-group contracts
- Transfer pricing documentation
- Benchmarking analysis
- Support during German tax audits
German tax support for acquisitions, investments, conversions and disposals.
- Tax due diligence
- Acquisition and investment structuring
- Review of historical tax risks
- Tax priorities post-acquisition
- Conversions and shareholding changes
- Sale preparation and disposal structures
Tax and strategic support for foreign companies entering the German market: location selection based on economic, tax and regional funding criteria; formation and structuring of German companies and branches; tax registration, VAT and ongoing compliance; coordination with regional economic development agencies and other partners.
- Location selection based on economic, tax and funding criteria
- Formation and structuring of a GmbH, branch or permanent establishment
- Tax registrations and VAT
- Ongoing tax compliance
- Coordination with economic development agencies and partners
From location selection to successful implementation of your investment in Germany.
We support companies and international investors with location analysis, investment planning, financing and public funding. We coordinate specialist subsidy advisers, banks and regional partners, and provide the tax advisory throughout the project.
- Location comparison and selection of the right federal state
- Investment structure and tax planning
- Identification of suitable funding programmes and advisers
- Coordination of overall financing with banks and development institutions
- Coordination of regional partners for administrative and organisational matters
- Structuring and support through the implementation process
- Tax reviews and confirmations
- Support with funding drawdowns, supporting documentation and reporting obligations
- Contacts in Berlin, Brandenburg, North Rhine-Westphalia and other German states
Fundamental structural and strategic changes in owner-managed businesses must be planned jointly at company and shareholder level. This includes reorganisations, ownership and holding structures, business succession, exit planning and international relocation. Dallman has particular expertise and extensive practical experience in German exit taxation. The objective is to align corporate structure, shareholdings, distributions, remuneration and personal tax residence as a coherent overall picture before implementation.
- Strategic structural changes and reorganisations
- International relocation and German exit taxation
- Corporate, ownership and holding structures
- Taxation of the company and its shareholders
- Distributions, remuneration and personal tax residence
- Business succession, sale and exit
- Coordination with foreign advisers where foreign law is involved
Frequently Asked Questions — Tax Advisory
Does every international change of residence trigger German exit taxation?
No. Whether Section 6 of the German Foreign Tax Act (AStG) applies depends on factors including the shareholding, the period of prior German tax liability, the specific structure and the target state. The tax consequences should be reviewed before the change of residence and before any related distributions, restructurings or disposals. Among other things, Section 6 AStG requires that the taxpayer was subject to unlimited German tax liability for at least seven of the last twelve years and holds at least 1 % in a corporation. Since 2022, even a move within the EU no longer qualifies for an interest-free, open-ended deferral: on application, the tax can be paid in seven annual instalments, usually against security. If the taxpayer returns to Germany within seven years (twelve on application), the tax claim may lapse under certain conditions.
Legal framework
Which provisions actually apply depends on the specific facts, the states involved and the legal position in force at the time.
Are intercompany contracts sufficient to establish a defensible transfer pricing position?
No. Contracts must be consistent with the functions actually performed, risks assumed, decision-making processes and value creation. A defensible position combines business model, contracts, pricing methodology, accounting and documentation.
Legal framework
- Section 1 AStG – Arm's length principle (opens in a new tab)
- Section 90(3) AO – Record-keeping obligations (opens in a new tab)
- GAufzV – Profit Allocation Documentation Ordinance (opens in a new tab)
Which provisions actually apply depends on the specific facts, the states involved and the legal position in force at the time.
When should a company start preparing for a German tax audit?
Ideally not after the audit notice has already been received. Contracts, calculations, accounting processes, transfer prices and audit-relevant data should be built up consistently and transparently during ongoing operations.
How should a company communicate with the tax auditor during a German tax audit?
A German tax audit is a formal procedure with significant legal and financial consequences. It is strongly advisable not to communicate directly with the auditor without the involvement of a tax adviser — and this recommendation applies from the very first day of the audit, not only when difficult questions arise. Auditors routinely gather information and assess it. The risk is rarely that the information itself is wrong. The risk is that information given without context, or phrased imprecisely, is understood differently from what was intended — and that the auditor draws conclusions from it that are then very difficult to correct. Explanations given later, however thorough, rarely fully undo an impression already formed. Statements that seemed straightforward can open lines of inquiry that would not have arisen at all if the question had been answered in a targeted, considered way. A tax adviser understands what the auditor is actually looking for. Rather than giving broad answers that may touch on areas outside the question, the adviser responds specifically to what was asked — and nothing more. This keeps the conversation focused, avoids creating unnecessary topics that would require further explanation, and prevents positions from hardening in a way that becomes costly to resolve later. The recommended approach: all communication with the auditor runs through the tax adviser. Documents and information are disclosed in a structured and controlled manner. Requests from the auditor are reviewed before being responded to. Where questions touch on legally uncertain territory, positions are prepared and substantiated before any response is given. This is not about withholding information from the tax authorities — it is about ensuring that the company is represented in an organised and professionally grounded way throughout the process.
Legal framework
- Sections 193 et seq. AO – External tax audit (opens in a new tab)
- Section 200 AO – Duties to cooperate (opens in a new tab)
Which provisions actually apply depends on the specific facts, the states involved and the legal position in force at the time.
Can a company start investing before funding is approved?
As a general rule, no. Before commencing investments – such as purchasing production equipment, hiring staff, or beginning research activities in the case of research funding – the company should first identify the relevant German federal state in which the project will be carried out, approach the competent investment or development bank, and have the funding eligibility assessed. Most programmes require approval for early project commencement (vorzeitiger Maßnahmenbeginn) before the final funding decision. Investments started without this approval are typically no longer eligible for funding. The reason is the so-called incentive effect: under EU state aid law (Art. 6 GBER), aid may generally only be granted if the application was submitted before work on the project starts.
Legal framework
Which provisions actually apply depends on the specific facts, the states involved and the legal position in force at the time.
This information provides a general overview and does not replace an assessment of the individual facts and circumstances.