StartCriminal tax lawVoluntary Self-DisclosureCorrection of Sales Tax Returns

Correction of Sales Tax Returns

According to section 18 sub-sections 1 and 2 German Sales Tax Act, entrepreneurs are required to submit sales tax returns to the fiscal administration by the 10th day after the end of the subsequent month. In addition to the monthly or quarterly sales tax advance returns, they also have to submit an annual sales tax return to the fiscal office according to section 18 sub-section 3 UStG. The annual sales tax return summarises the individual sales tax advance returns into one annual return. The amounts resulting from the advance returns are considered with regard to the annual tax liability.

In a bulk business as in the case of sales tax, this often results in a correction or catch-up requirement for these returns. For example, the correction and catching-up of sales tax advance returns was often common practice in the past - in particular in bigger companies. The legislator amended the rules regarding voluntary disclosure under section 371 AO in the Law Combating Illicit Earnings from 2011 (German Federal Gazette I 2011, p. 676), as a result of which the criminal tax law risks in the event of a correction of omitted or incorrect declarations have increased significantly. Moreover, in the Law amending the Tax Code with effect as of January 1st, 2015 (German Federal Gazette I 2014, p. 2415) the legislator tightened these provisions, while some of the provisions were eased again. For example, the added section 371 sub-section 2a AO, e.g., provides for an exception from the so-called requirement of completeness of intra-year sales tax advance returns.

LHP note: In order to avoid criminal tax law risks, the correction of sales tax returns should be avoided right from the outset, if possible. The commonly used correction of returns should be avoided in future following the tightening of the rules on voluntary disclosures. Because of the tightened provisions on self-disclosure which are hard to understand for people not familiar with criminal tax law, corrections can involve considerable risks for the managing directors and authorised signatories, etc., concerned. Our consultation practice has shown that the problems connected with a correction can often be resolved satisfactorily with professional correction management.

Delayed or incorrect sales tax return

Correction of the income tax registration in cases of premeditated tax evasion

Conditions for the effectiveness of a voluntary self-disclosure to avoid penalty

Correction of advance returns in cases of reckless tax reduction

Correction of advance returns in cases of simple negligence

LHP note: With regard to the correction of sales tax returns, various constellations of how such a correction can be effectively designed in a specific case are conceivable under consideration of the relationship between the advance returns and the annual return. Our firm has published extensively on this in the specialist literature (e.g. Lawyer/Tax Adviser Ingo Heuel and Lawyer Dirk Beyer, NWB-BBK 2015, p. 740). A correction of preliminary tax reports should be planned and implemented quickly but with a view for all essential items. We can only touch upon the numerous pitfalls here. In our consulting practice, most problems can frequently be resolved through a consultation in an individual case.

As lawyers as well as tax and criminal law experts, we have specific know-how in dealing with criminal tax law proceedings of all kinds.This also includes support in criminal proceedings influenced by sales tax aspects. In this field, we have long-standing experience based on numerous successful proceedings and publications. Moreover, we can use our many years of experience in working with the investigation authorities, the departments of public prosecution and courts which we use in your best interest in dealing with criminal tax law matters. We help you to both prevent the accusation of a tax offence and effectively defend against such.


LHP: Attorneys at Law, Tax Law Specialists, Tax Advisers PartmbB


An der Pauluskirche 3-5, 50677 Cologne,
Telephone: +49 221 39 09 770


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Telephone: +41 44 212 3535

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