Accusation: Failure to submit the VAT return for 2006.
June 14, 2011 | 30,00 EUR | answered by StB Manuela Ponikwar
Dear Sir or Madam,
A friend of mine brought me a letter from the tax office in Cottbus today (which is not his resident tax office) and asked for my advice, but I do not have the expertise in this matter. I have attached the letter for your reference. My friend mentioned that he was not liable for VAT in 2006 and had an overall loss. He simply forgot that he had this turnover, as the company did not pay him not only this fee, but also many other fees. He just wants to know if he should respond to this letter or wait for a letter from his resident tax office.
Thank you very much for your prompt response.
Sincerely,
Dear inquirer,
Thank you for your inquiry, which I would like to answer as part of an initial consultation considering the appropriate fee as follows:
The tax office obtains such information due to so-called cross-reports. Therefore, it is likely that your friend's customer underwent a tax audit. In such cases, the taxation of incoming invoices is also checked at the invoice issuer on a random basis.
In this specific case, only the value-added tax is being criticized, so I cannot make any statements regarding income tax. A loss situation in business activities is not relevant for VAT purposes.
Your friend stated that he is not liable for VAT. Therefore, he was either exempt from VAT due to his activities or considers himself a small business owner:
Small business owners are entrepreneurs who are domiciled in the country or in the areas specified in § 1 (3) UStG and whose relevant total turnover
• did not exceed 17,500 EUR in the previous calendar year, and
• is not expected to exceed 50,000 EUR in the current calendar year.
Both limits must not be exceeded, otherwise the small business owner taxation according to § 19 UStG will not apply.
However, the tax office stated in its letter that your friend invoiced VAT on his invoices, or did not indicate tax exemption. According to §14c (2) UStG, tax must also be paid to the tax office for incorrectly invoiced tax.
Incorrectly invoiced tax can only be corrected if "the tax revenue is not endangered". Since the customer (company VMS) claimed input tax from the tax office, the customer would have to repay the input tax based on a corrected invoice.
The correction of the tax amount owed must be requested separately in writing from the tax office and, after its approval, carried out in accordance with § 17 (1) UStG for the tax period in which the conditions of sentence 4 have occurred.
Despite this, your friend should still expect interest on the incorrectly invoiced tax, as the input tax had already been refunded to the customer in 2006.
Since tax evasion only expires after 10 years, I cannot recommend ignoring the letter, as it may have been issued by the wrong authority. The notice for the additional payment will definitely come from the correct tax office. However, this letter itself does not require any specific action, the payment will only be made based on the notice.
Nevertheless, your friend should now carefully consider whether there were any other invoices for which he might owe VAT. If this is the case, I strongly recommend your friend to consult a professional colleague to examine any remaining possibilities for voluntary disclosure.
I hope this information was helpful to you.
Kind regards,
Manuela Ponikwar
Tax advisor
www.ponikwar.de
