Finland Supreme Administrative Court Clarifies Corporate Tax Treatment upon Cross-Border Merger

The Finnish Supreme Administrative Court July 5 posted online Decision No. KHO:2022:87, clarifying the corporate tax treatment in a cross-border merger. Group company A acquired group company B, for which group company B received shares and cash from group company A. The excess amount of the transaction was recorded on A’s balance sheet as goodwill. Upon appeal, the Supreme Administrative Court upheld the tax agency’s decision that the goodwill recorded on A’s 2019 financial statements wasn’t tax deductible as to A’s income, and clarified that: 1) the merger didn’t meet the requirements for a tax-neutral merger under the specific provisions ...