Profit Sharing Loans and the Power of the Tax Authorities to Reclassify Transactions: a ruling of the National High Court raising the stakes on abuse of power

In summary, in the absence of sufficient evidence regarding the existence of economic substance other than mere tax aims, the NHC gives preference to the form given by the taxpayer to a transaction, basing its Judgment on principles related to the burden of proof applied in connection with the administrative power of standardization, carried out giving priority to substance over form…