In its decision of April 15th , 2021, the Austrian Federal Tax Court (BFG) had to deal with an international income allocation conflict under the Austrian-Swiss tax treaty. While the Austrian tax authorities attributed the income of a Swiss limited liability company to its shareholder and managing director domiciled in Austria according to margin number 104 of the Austrian Income Tax Guidelines, the same income was allocated to the Swiss company under Swiss tax law. In its reasoning, the Austrian Federal Tax Court essentially adopted the position of the Austrian Federal Ministry of Finance (BMF) and (mistakenly) affirmed the obligation to credit the Swiss tax. Michael Lang analyzes the case and criticizes the approach taken by the Court.
