Tax evasion: Investigators’ nets becoming ever more tightly knit – Voluntary disclosure a loophole
http://www.grprainer.com/en/legal-advice/tax-law/voluntary-disclosure.html Whether it be untaxed illicit earnings or untaxed income from capital, tax evaders are taking a big risk. They can address the risk of being convicted with a voluntary declaration.
GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London – www.grprainer.com/en conclude: Tax investigations are increasingly tightening their nets to combat tax evasion across borders. It is becoming more and more difficult for tax dodgers to find a way out of this closely woven net. If the tax evasion is detected by the authorities, offenders may be faced with high fines or custodial sentences. A voluntary declaration enables them to protect themselves from a conviction for tax evasion.
It is important in this context to take action before the tax evasion is discovered. With more than 50 countries committed to automatically exchanging fiscal data among themselves from 2017, time is starting to run out. Aside from this automatic exchange of information, the tax authorities already have various means at their disposal to track untaxed or falsely declared income. A voluntary declaration can only lead to immunity if it is submitted on time, i.e. before the offence has been discovered.
That being said, it ought not to be drawn up rashly; in addition to being submitted on time, the voluntary declaration also needs to be complete and error-free. It is almost impossible for a layperson to satisfy these strict requirements. For this reason, a voluntary declaration should not be prepared alone or with the help of standard templates. This risk of mistakes being made is high and even small errors can result in the voluntary declaration failing. It is safer to consult lawyers and tax advisors who are experienced in the field of tax law. They can appraise the specific circumstances of each individual case and know which documents and information need to be included in the voluntary declaration for it to be able to lead to immunity.
If the amount of evaded taxes does not exceed 25,000 euros, only the tax liabilities along with interest have to be paid if the voluntary declaration succeeds. There is then no threat of further sanctions. In cases involving higher amounts of evaded taxes, additional penal surcharges of between ten and twenty per cent of the sum of evaded taxes will be imposed. Once all payments have been made, further criminal proceedings are no longer a possibility.
GRP Rainer LLP is an international law firm with lawyers and tax advisers specializing in business law, commercial law and company law and tax law. The attorneys counsel international commercial and industrial companies and corporations, as well as associations, mid-sized businesses, institutional investors and private individuals worldwide from offices in Cologne, Berlin, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart, Germany and London UK.