The Federal Ministry of Finance (BMF) has now published a ministerial draft bill for an "Act Amending the Fiscal Code and the Introductory Act to the Fiscal Code." The Federal Cabinet has already addressed the draft, so the act is expected to be passed within this year. Changes in the ministerial draft bill on voluntary self-disclosure: Below, we outline some of the most important changes in brief:
- the limitation period for criminal prosecution is to be extended to ten years in all cases of tax evasion
- the previous threshold of EUR 50,000, below which prosecution is waived without payment of a surcharge pursuant to § 398a AO, will be lowered to EUR 25,000
- the surcharge pursuant to § 398a AO will be tiered depending on the amount evaded:
- evaded amount over EUR 25,000 up to EUR 100,000: 10%
- evaded amount over EUR 100,000 up to EUR 1,000,000: 15%
- evaded amount over EUR 1,000,000: 20%
- introduction of a suspension of the tax assessment period for undeclared foreign capital income
- expansion of the grounds barring self-disclosure, e.g., by including the VAT inspection (Umsatzsteuer-Nachschau)
We will, of course, continue to monitor current political developments in the area of tax criminal law on your behalf. In any case, it is readily apparent that the planned act is intended to significantly tighten the requirements for filing a voluntary self-disclosure with exemption from prosecution. We are happy to advise you on all questions regarding voluntary self-disclosure and tax criminal law.
Frequently asked questions
Frequently asked questions
How long will the statute of limitations for prosecuting tax evasion be in the future?
According to the BMF's ministerial draft, the statute of limitations for prosecuting tax evasion is to be extended to ten years in all cases. This will therefore no longer apply only to particularly serious cases, but uniformly to all forms of tax evasion.
From what amount of evasion does a surcharge under § 398a AO apply in a voluntary disclosure?
The previous threshold of EUR 50,000 is to be lowered to EUR 25,000. Up to this amount, prosecution is waived without payment of a surcharge. If the evaded amount exceeds EUR 25,000, a tiered surcharge must be paid in addition to the back taxes.
How will the surcharge under Section 398a AO be tiered in the future?
The surcharge is to be tiered based on the amount of tax evaded: 10% for amounts exceeding €25,000 up to €100,000, 15% for amounts exceeding €100,000 up to €1,000,000, and 20% for amounts exceeding €1,000,000. This significantly increases the financial burden of a voluntary disclosure.
What new rule is planned for undeclared foreign investment income?
A tax-related suspension of the start of the assessment period (Anlaufhemmung) is to be introduced for undeclared foreign investment income. As a result, the assessment period will begin later, allowing the tax office to subsequently tax such income over a longer period.
Which new disqualifying grounds for a voluntary self-disclosure with exemption from prosecution are envisaged?
The disqualifying grounds are to be expanded, in particular by including the VAT inspection (Umsatzsteuer-Nachschau). This means an effective self-disclosure is no longer possible once an auditor has appeared for a VAT inspection. Overall, the requirements for a voluntary self-disclosure with exemption from prosecution are being significantly tightened.