Will Remote Working Mark the End of Substance Requirements?

In this note, the authors explore the impact of cross-border remote working on the area of tax legislation. Specifically, they examine how substance requirements that deny certain tax benefits in respect of (allegedly) artificial situations, have been impacted by this development, with a particular focus on the dividend withholding tax exemption under the EU Parent-Subsidiary Directive (2011/96). They argue that the substance tests as currently applied in many EU Member States and as included in the draft Unshell Directive conflict with the freedom of establishment.