Tax evasion: Voluntary declaration must be made in good time

[GRP Rainer LLP Lawyers Tax Advisors - 14.08.2014] GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London - www.grprainer.com/en conclude: Tax evasion is a criminal offense, but German tax law allows one to make a voluntary declaration of an incomplete tax return leading to immunity from punishment. If all tax omissions from the past five years are presented to the tax office accompanied by the necessary documents, the tax evader returns to being tax compliant.

For this to happen, essentially two conditions must be satisfied: The documents pertaining to the tax omissions from the past five years must be exhaustive so that a new tax assessment can be issued within a short space of time. The tax liability must then be discharged within a short timeframe. Moreover, the voluntary declaration must be made in good time.

However, when a voluntary declaration has been made in good time is disputed. If the authorities have already begun investigations it is too late. But it is questionable, for example, whether the mere presumption that one's name could appear on a purchased CD on tax evaders means the voluntary declaration can no longer be submitted on time.

Tax evaders who want to submit a voluntary declaration should therefore urgently consult with a lawyer competent in the field of tax law. He will be able to judge whether the voluntary declaration has been made on time and can also be of assistance in preparing it, as submitting a voluntary declaration in such a way that it actually exempts you from punishment is a complicated process which can be difficult for a layman to keep track of. Even standard forms are scarcely able to account for the complex and wide range of circumstances. The consequence of this can then be that the voluntary declaration is unsuccessful and severe penalties follow.

The risk of a voluntary declaration being ineffective is significantly reduced with the support of competent lawyers and tax advisors. They know which documents are required and, if need be, are able to estimate the tax liability should important documents still be missing.

Since the rules for voluntary declarations leading to immunity are expected to be substantially tightened from 2015, they should be submitted in this year as far as possible.

http://www.grprainer.com/en/Voluntary-Disclosure.html