254. Domicile and Centre of Vital Interests

Martin Ribbrock, KPMG Frankfurt

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Individuals with either a domicile or their habitual abode in Germany are subject to German tax on their worldwide income (߆1 (1) EStG). In its judgement of 24†January 2001 (I†R 100/99 - IStR 2001, 349), the Federal Tax Court (FTC) reaffirms its consistent decisional law that individuals with a German domicile are subject to tax in Germany on their worldwide incomes whether or not they have their centre of vital interests in Germany.

The taxpayer was apparently a German national who had moved to Hong Kong after completing his studies as an engineer and lived there predominantly ever since. The taxpayer owned two houses in Germany and maintained a fully furnished dwelling in one of these houses that was available for his use at any time. The unit comprised 297†m2 of living space, making...