Company pension plan – difference for new pension commitments in the year of publication of new mortality tables

Difference in the case of new pension commitments in the year of publication of new mortality tables (BFH, decision dated February 13, 2019, XI R 34/16)

Christine Hansen and Jean-Baptiste Abel

The plaintiff was a limited liability company (GmbH) that issued a pension commitment to its shareholder managing director in November 2005. The amount reported does not include any additional amount due to the changes in the Heubeck 2005 mortality tables, which were applicable for the first time in 2005, compared with the Heubeck 1998 mortality tables. The tax office assumed that a difference based on the first-time application of the 2005 mortality tables would also have to be spread over three years in the year of the first commitment.
The BFH ruled that no distribution was to be made. The wording of the provision in § 6a para. 4 sentence 2 EStG requires a difference between the partial value of the pension obligation at the end of the fiscal year and at the end of the previous fiscal year. There is no difference when a pension provision is initially recognized. A distribution of the difference is therefore not possible in assessment periods in which a pension commitment is made. The purpose of the provision does not permit any other result either, as it cannot be inferred from the legislative materials that the provision is intended to be applied beyond the wording also to cases of the first-time formation of a pension provision. The BFH thus rejects the opinion of the BMF most recently expressed in the BMF letter of October 19, 2018 (para. 2 therein) that the transfer must take place uniformly for all pension obligations.

Conclusion: Remarkably, the BFH does not base its decision on the fact that the commitment was made after the publication of the new 2015 mortality tables. The decision is thus likely to apply to all new commitments made in the year of the new board’s publication – regardless of whether they were made before or after its publication. The decisive factor should be that a provision was recognized for the first time at the end of the year in question. The decision is particularly topical due to the fact that the 2018 G Heubeck mortality tables were published last year.