Tax Offences in Germany: Criminal Liability

Tax Offences in Germany: Criminal Liability

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Breaching German tax laws can result in severe criminal sanctions ranging from fines and other penalties to imprisonment. Due to the inherent complications involved in German tax law, it is crucial to avail of legal expertise in this field. Companies and private individuals can breach German tax law without even realising that they are doing it. In such a situation communicating with an experienced German tax lawyer as quickly as possible is vital.

At Schlun & Elseven Rechtsanwälte, our lawyers provide specialist assistance in this area. Please do not hesitate to contact us directly if you require specialised legal assistance.

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Tax Offences under German Law

The German Tax Code (Fiscal Code / Abgabenordnung or AO) is the main source of German tax law, providing a list of tax offences with definitions. At Schlun & Elseven Rechtsanwälte, our tax criminal lawyers advise on all these matters, among others:

As can be seen, there are several tax offences under German law that one must be aware of as both a private individual and a company. We will examine some of these in more detail.

Tax Evasion

Should a person be found guilty of tax evasion, they can face a fine or a prison sentence. The prison sentence can be up to 5 years or even up to 10 years in the case of more serious tax offences.

In the case of tax evasion, even its attempt can result in being found liable with punishment of a fine or prison sentence.

The offence of tax evasion involves providing the authorities with incorrect information concerning their financial situation or failing to update the authorities on developments concerning their financial situation when obliged to do so. Such actions should be shown to have taken place in order to provide financial advantage to either the person committing the action or another person.

Serious tax evasion offences concern the nature of the offence committed. Serious offences are those where there is a deliberate intent as well as large sums of money involved as well as those where offences are committed through the usage of forged or falsified documents.

Repeated offences and abuse of position as a public official can also lead to serious consequences.

In accusations of this nature it is more important than ever to make sure you have the assistance of a legal professional to analyse your case and provide you with options.

Tax Offences: Smuggling / Organised Crime Accusations

Where a person has been found to be smuggling or performing tax offences for the purposes of organised crime in many cases they can face imprisonment of up to ten years.

In the case of minor offences this maximum sentence can be reduced to five years.

In such cases, the authorities will consider factors such as weapon possession while performing actions such as evading import or export duties or illegally importing, exporting or transporting goods, performing such actions using a weapon or other tool to carry a threat of violence and repeated actions or membership of a gang.

Organised crime and smuggling accusations can be very costly. Once again, availing of a criminal lawyer can make a huge difference when facing such accusations.

Voluntary Self-Disclosure

One option available to companies and individuals is to pursue voluntary self-disclosure.

Voluntary self-disclosure of tax evasion is legislated under § 371 AO and can prevent a party from receiving a criminal conviction.

An exemption from punishment or criminal conviction occurs when the party:

  • files the voluntary disclosure on time,
  • following this step, they then declare their entire income in total, and
  • resolves the remaining tax liability as well as any related interest payments.

The interest payment rate will also vary depending on the facts of the case and the sum evaded.

It is worth considering that the first requirement of filing the disclosure on time means it occurs before an investigation ensues. If a company files a voluntary self-disclosure in the incorrect manner, it can lead to serious consequences for the company, therefore consulting with legal experts should be considered a prerequisite.

At Schlun & Elseven Rechtsanwälte, our professionals will analyse your company’s financial situation in detail and determine the correct figures and the timeframes that need to be considered. We will ensure that your company has the necessary documentation to complete the disclosure.

Tax Offences: Strategy for Defendant

If you are in a situation where you have been accused of tax evasion or another tax offence, it is critical to contact an experienced criminal lawyer as soon as possible.

Even early in the investigation, one can face potential house searches and seizures and, in other cases, even pre-trial detention. Knowing what to do in the event of a house or office search is crucial. Statements or actions committed during this time can have severe consequences and affect further legal proceedings.

Our lawyers will advise and support our clients during office and house searches, but we will also develop our strategy with them. A solid plan is the surest way to overcome any charges brought.

From early on in proceedings, we ensure that our clients inform them of their options throughout the process and advise them on how the situation will likely develop. When forming the strategy, it is vital for clients not to make any statements or declarations before discussing the issue with their lawyer.

Working closely with our legal team means the strategy does not get confused in the process. Often it is possible to resolve cases concerning tax offences outside of the courtroom; we know for many, this is the preferred solution. Court cases can be time-consuming and lead to exposure in the press, regardless of the outcome.

Where possible, we will seek to resolve the issue outside of court, but on occasion, it will be in our client’s interest to bring the case to court. In such an event, we will represent our clients.

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Practice Group: German Criminal Tax Law

Practice Group:
German Criminal Tax Law Cases

Dr. Julius Hagen


Philipp Busse


Dr. Matthias Wurm