Passive income of a controlled foreign company (so-called intermediate company) is generally subject to CFC-taxation in accordance with Sections 7 et seq. AStG if the income is subject to low taxation abroad. This is the case if the income tax burden abroad is less than 15% (so-called low tax threshold, Section 8 para. 5 AStG).

Control exists if more than 50% of the shares or voting rights in the nominal capital are directly or indirectly attributable to the German Shareholder alone or jointly with related parties, or if the German Shareholder is directly or indirectly entitled to more than half of the profits or liquidation proceeds of that company at the end of the fiscal year.
