Since the beginning of the year, the Act on the Modernisation of Taxation Procedures has introduced new regulations that entail additional risks.
Particular attention should be paid to the new provision of Section 150 (7) AO, which provides taxpayers with new options for two tax return cases, which may, however, prove to be dangerous:
- According to the likewise new Section 155 (4) AO, tax returns can be processed fully automatically, provided there is no reason to process the individual case personally.
- In addition, data transmitted by third parties, such as employers, banks or insurance companies, will be deemed to have been transmitted by the taxpayer. This means that the taxpayer does not have to provide this data again themselves (Section 150 (7) sentence 2 AO).
In these cases, the taxpayer can provide information in a new free text field to be created if, in his opinion, there is reason for processing by public officials. Particular caution should be exercised here. If facts are concealed by the automatically transmitted data or even incorrect data is sent to the tax office, resulting in tax damage or an unjustified tax advantage, this may constitute a tax evasion that is subject to criminal prosecution. According to current case law, the taxpayer only makes incorrect statements within the meaning of Section 370 para. 1 no. 1 AO (tax evasion) if they openly or covertly hold a legal opinion that is favourable to them, but present the tax-relevant facts correctly and completely, thereby enabling the tax office to correctly assess the tax based on a different legal assessment (according to the Regional Court of Cologne, decision of 16.07.2015, 106 Qs 1/15). Comprehensive and truthful disclosure of facts in which a possibly different legal opinion is represented to the tax authority is therefore particularly important. The new free text field should therefore not be carelessly ignored or even used to conceal aggressive tax arrangements.
