Commencement of Criminal Tax Proceedings

LHP Attorneys offer legal advice and representation if criminal tax proceedings are commenced.

Investigation proceedings are commenced for the purpose of conducting investigations in criminal tax matters. Depending on which authority has developed the approach for an investigation and is in charge, it assumes the commencement and the respective notification of commencement of proceedings under § 397 Sec 3 AO. Irrespective of a notice of commenced proceedings, criminal proceedings are commenced under § 397 Sec 1 AO as soon as the fiscal authority, the police, the public prosecutor, one of their investigators or a criminal judge takes any action, which obviously aims at prosecution for a tax offence. The taxpayer being subject of the proceedings becomes the accused simply by investigations being commenced. He must then be informed of his rights, that he is at liberty to remain silent or give testimony and may at any time consult with a defence attorney of his choice (compare §§ 136 in connection with § 163a StPO). A breach of the duty to inform the accused of his rights results a prohibition of exploitation (see below for details). § 397 Sec 3 and § 393 Sec 1 lit 4 AO stipulate, that the accused must be informed of his rights no later than being requested to give testimony. There are no legal remedies against the commencement of criminal tax proceedings. Note: In providing further assistance in the proceedings, the defence attorney should examine, whether investigations were conducted against his client prior to him being notified of the commencement of criminal proceedings. If this is the case, a prohibition of exploitation may apply due to the taxpayer not being informed of his statutory rights. Such an examination should be performed meticulously, in particular in cases where criminal tax proceedings are commenced following the conclusion of a company tax audit. Tax auditors sometimes voice their suspicions very late, in order to possibly hear more information from the taxpayer. The reader is referred to § 10 BpO and the identical decree of the highest fiscal authorities of the federal states dated 31.08.2009, which will be explained in detail further below.