The number of voluntary declarations in cases of tax evasion continues to increase. More than 25,000 voluntary declarations have since been submitted in Baden-Württemberg according to media reports.
GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London - www.grprainer.com/en conclude: The planned tightening of the rules for voluntary disclosure in cases of tax evasion has apparently once again led to an increase in voluntary declarations. Almost 20 per cent more voluntary declarations were received as early as November 2014 in Baden-Württemberg than in 2013. Since February 2010, more than 25,000 tax evaders in Baden-Württemberg have submitted voluntary declarations.
The numbers demonstrate that voluntary disclosure is a popular way for tax evaders to return to a state of tax compliance and avoid a conviction for tax evasion. Having said that, voluntary disclosure is not a free pass. It can only be effective if the requirements are fulfilled exactly. The voluntary declaration has to be submitted before the authorities have commenced investigations and must be complete, i.e. it needs to include all relevant information concerning tax affairs from the past five years for the tax office to be able to issue a new tax assessment notice. However, should the voluntary declaration be flawed, there is still the risk of a conviction for tax evasion. The result can be high financial penalties or custodial sentences.
For this reason, a voluntary declaration ought not to be drawn up alone or with the help of standard templates. The risk of mistakes being made in the process and the voluntary declaration failing is too high. It is safer to turn to lawyers and tax advisors who are experienced in the field of tax law. They can appraise each case individually, know which documents are required and are able to prepare the voluntary declaration in such a way that it is complete and effective. If no more than 50,000 euros in taxes have been evaded, the voluntary declaration will then lead to complete immunity. In cases involving larger amounts, a penalty of 5 per cent has to be paid.
It is expected to become considerably more expensive from 2015. It will then only be possible for sums of up to 25,000 euros to go completely unpunished. Where larger amounts are involved, tiered penalties of between ten and twenty per cent shall be charged. Additionally, all tax-relevant documents from the last ten years will need to be disclosed.
For more informations: http://www.grprainer.com/en/legal-advice/tax-law/voluntary-disclosure.html