TaxPersonal TaxTaxpayers celebrate Meilicke ECJ victory

Taxpayers celebrate Meilicke ECJ victory

ECJ decision restricts temporal limitation powers and backs up Manninen decision

The European Court of
Justice
has restricted the use of temporal limitation powers as it
ruled for the taxpayer in the Meilicke case on tax credits on dividends.

The case challenged German rules granting tax credits to individuals
receiving German sourced dividends, but not on overseas source dividends. The
ECJ held that this was contrary to the free movement of capital, confirming a
similar case in Finland known as the Manninen case.

Jonathan Bridges from KPMG
welcomed the decision, but said a far more important consequence of the
ruling was the fact that the ECJ introduced no temporal limitation on its
decision.

Temporal limitation is a power the ECJ has to restrict the scope of its
judgments to limited categories of taxpayers if it fears that the financial
exposure of a member state to a decision will be too great.

Temporal limitation was a key factor of the Meilicke case, which required two
advocate general opinions in order to address the question of temporal
limitation.

The ECJ decision on Meilicke introduced no such limitation, opening the door
for other tax cases to enjoy similar benefits.

‘The temporal limitation issue is one that could benefit other tax cases at
the ECJ,’ said Meilicke. ‘In the Meilicke case the use of temporal limitation
was not introduced, which could restrict its use in the future.’

Further reading:

Read
the full judgment

Treasury rejects CIOT request on Manninen

Treasury heads for EU clash over tax credit case 

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

1d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2w Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

2m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

4m Alia Shoaib, Reporter
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

4m Emma Smith, Managing Editor
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

5m Alia Shoaib, Reporter
Does the Taylor Review sufficiently address the gig economy?

Corporate Tax Does the Taylor Review sufficiently address the gig economy?

5m Alia Shoaib, Reporter