A intends to acquire the shares in B. ltd, a corporation established in Ireland and tax registered in Germany. In the due diligence, the following facts on B’s tax position are disclosed. Which taxable profit (2021) of B would A have to expect? B. ltd.’s profit before tax per its pro forma statutory financial statements (HGB = German GAAP) for 2021 amounts to € 710.000. Certain losses expected from pending contracts were recorded (€ 200.000), which are not deductible for tax purposes. B ltd. realized a loss in a foreign permanent establishment, which is tax exempt in Germany (€ 50.000). Out of the recorded pension expenses of € 120.000 only € 80.000 are tax deductible.

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A wants to know the actual profit of B which discloses the true net worth ... View the full answer