The Federal Fiscal Court recently ruled on the question of when a taxable gift between spouses exists in certain constellations.
In the case of the judgement from 29 June 2016 (AZ II R 41/14), a husband transferred a bank custody account to his wife. The tax office assumed a gift in the full amount of the securities account value. The wife claimed that she was only enriched to half of the assets, as she was already entitled to the other half before the transfer. The BFH ruled that an individual account is generally attributable to the account holder alone and that the wife's mere assertion that she was already entitled to half is not sufficient to prove her entitlement. According to the judgement, the spouse receiving the gift bears the burden of proof for facts that contradict the assumption of a generous gift of an individual account/deposit. This also applies to the agreement between the spouses regarding the entitlement to the custody account.
This decision concerns individual accounts of spouses. The BFH already ruled in 2011 (judgement of 23 November 2011, AZ II R 33/10) that the tax office bears the burden of establishing the facts that justify a generous contribution to the non-contributing spouse if only one spouse makes deposits. However, if there are objective indications that both spouses are equally entitled to a joint account, the taxpayer bears the burden of establishing that only the paying spouse should be entitled in the internal relationship, according to the judgement. It then depends on the actual utilisation of the customer relationship, in particular how the assets were used.
If tax evasion is involved, the standard changes with regard to issues relevant to criminal tax law, such as the assessment of interest for evasion in another judgement case. According to the BFH (judgement of 12.07.2016, AZ II R 42/14), a decision according to the rules of the burden of proof to the detriment of the taxpayer is then not permissible. In this case, the donee claimed that the donor had already held the gift for him as a trustee prior to the transfer. According to the BFH, the tax office bears the burden of proof for the assumption of a generous gift. However, the mere assertion of a fiduciary agreement without further evidence of its correctness is not sufficient. When examining whether a fiduciary relationship actually exists, the BFH adheres to its principle that a strict standard must be applied.
