Taxes for the PLC and the LLC
The public limited company and the limited liability company (GmbH) have their own legal personality. There is therefore a clear separation between the taxation of the PLC/LLC and the individual shareholders.
Separation between natural person and legal entity
The PLC/LLC is taxed solely as a legal entity, while the shareholders are normally taxed as private individuals independently of this. This leads to partial economic double taxation:
The net profit generated by the PLC/LLC at the end of the financial year is taxed on the one hand for the PLC/LLC and on the other hand also as private income for the shareholders if they receive a dividend (share of the profit) due to a profit distribution.
This is referred to as double taxation because the taxation of the profit of a PLC/LLC also indirectly reduces the dividend of the shareholders, which in turn is taxed on the basis of the income tax of natural persons.
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