Subsequent declaration of income/self-disclosure
February 12, 2011 | 30,00 EUR | answered by Oliver Burchardt
Dear Sir or Madam,
I have failed to declare the remuneration (a small amount per year) that I have received for my work as a member of the supervisory board of a small AG in recent years for tax purposes. I would like to rectify this now.
What steps do I need to take?
What are the criminal implications?
Will the tax office charge interest on the amounts retrospectively?
Can I deduct 25% as a flat rate for expenses, as I no longer have receipts? Apart from travel expenses, I can no longer provide any further documentation.
I would appreciate your response.
Best regards,
Dear inquirer,
Thank you for your inquiry, which I am happy to answer as part of an initial consultation.
Please note that the tax assessment is based on the information provided. Changing, adding, or omitting information can alter the assessment.
If you wish to retroactively declare undeclared income, you must provide all relevant information to the tax office so that they can calculate the correct tax liability. This includes the amount of income and all relevant business expenses. You can provide this information in a letter to the tax office, listing the income and business expenses for each assessment period. Please note that serving as a supervisory board member is considered entrepreneurial activity, so VAT liability applies here as well. However, if the remuneration is less than €17,500 per year and you do not carry out any other VAT-taxable transactions, the small business regulation according to § 19 UStG applies.
A lump-sum taxation is not provided, so you must credibly substantiate the business expenses to the tax office if you can no longer provide detailed evidence.
The tax office charges interest of 6% per year on the subsequently determined tax liability if more than 15 months have passed since the end of the assessment period. In this specific case, you will therefore have to expect interest for all years before 2009.
I cannot clarify the case from a tax criminal law perspective based on your information. In order to even expose yourself to the accusation of tax evasion, you must have intentionally not declared the income. If this is not the case and you simply forgot to declare the income out of ignorance, only the administrative offense of negligent tax evasion would be considered.
By retroactively declaring the previously undeclared income, you submit a self-report which can exempt you from criminal liability. However, this exemption only applies if you fully return to tax honesty. This means that you will only receive exemption from liability if you intentionally fail to declare any further income.
I hope I have been able to assist you in your query.
Best regards,
Oliver Burchardt
Tax Advisor
