Companies Relocating Within EU Cannot Offset Accrued Losses Anymore

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The Court of Justice of the European Union (ECHJ) has held in AURES Holdings (C-405/18) that acompany which relocates from one EU Member State to another cannot take its previously accrued tax losses with it, to be offset against future taxable income in the secondary jurisdiction.

The case concerned a Dutch company that incurred more than EUR €2 million of tax losses in the Netherlands in 2007, and two years later redomiciled to the Czech Republic and requested to write off its Dutch losses against the Czech taxable income from 2009.