The application for binding information at the tax office is a possibility that taxpayers can use to obtain legal certainty in advance about tax-relevant projects. In our article, we go into the essential details of a request for binding information at the tax office. Among other things, we describe the associated conditions, the content, the structure, the deadlines and the costs. We round off our information with tips that will help you crown your application with success. This also includes indications as to when they should waive an application.

1.1. Legal requirements for the application

The application for binding information at the tax office is a legally fixed instrument in tax law in the tax code. It offers the taxpayer, under certain conditions, the opportunity to obtain a tax assessment of the tax authority on a matter. The details are regulated in § 89 AO, which are supplemented by the instructions of the Tax Information Ordinance.

1.2. Who can make a request for binding information?

Applicants can be both individuals and communities or corporations. If several persons make an application, they shall act jointly with their request.

1.3. Processing period of the tax office

Another provision concerning the request for binding information relates to the time limit for producing the requested information. This must normally be done within 6 months of receipt of the application. However, this period may be exceeded if the applicant is informed of the reasons for this before the expiry of the period.

1.4. Commitment of the tax office to its decision

In addition, the tax office is bound in various ways by the decision it makes on the basis of the facts presented. For example, the tax office is also bound by its decision if the decision breaches applicable law in favour of the taxpayer. Conversely, however, a binding also ceases if it later emerges that essential information on the decision was missing or untrue in the application. And of course, the tax office is only bound by its decision as long as the legal basis for this remains unchanged.

1.5. Collection of a fee to process the application

A final introductory point is the fee charged by the financial administration for processing. As a rule, the fee depends on the object value of the facts. Only if there is no item value, the fee is set at a rate of EUR 50.00 per started half hour processing time. There is also an exception here, because if less than two hours are required for this, a calculation of the fee is omitted. And if the fee is an unreasonable hardship, the collection of the fee can be completely or partially omitted.

2 Requirements for the request for binding information

2.1 Form of application

The request for binding information must be made in writing. An application submitted by electronic means shall also be admissible.

2.2. Competent tax office

Responsible for this is the tax office, where the tax matter set out in the application would actually be dealt with. For example, if it is a matter under income tax, the taxpayer’s tax office of residence is also responsible for the application. If, as a second example, a GmbH makes an application, the tax office in whose district the management of the GmbH has its headquarters decides.

2.2 Deadline for submitting the application

Actually, one can hardly speak of a real deadline. Rather, it is a condition. The point is that the matter to be clarified by the motion is only in the planning stage and will only be applied in the future. The information is therefore only possible as a preliminary decision of the tax office. However, for circumstances that have already been initiated or even realized by the taxpayer, the application comes too late.

2.3 Legitimate interest of the applicant

The most important condition concerns the applicant. Only if he himself as a taxpayer has a legitimate interest in the information, his application is admissible. Purely hypothetical questions out of curiosity are thus excluded. Furthermore, the clarification of the substantive question put forward must have a significant impact on the future decision of the taxable person. In the case of small tax amounts, the application is therefore rejected by the tax office. However, there are no specific requirements for this, so that the decision on this is at the discretion of the case officer.

Furthermore, it must be ensured that the facts to be clarified have not previously been assessed by a court judgment or by other legal decisions. Commentary in the specialist literature should also be excluded as far as possible. Therefore, we recommend seeking the advice of an experienced tax consultant before submitting an application.

2.4. Content of the application

In addition to the essential data on the applicant, i.e. his name and address and tax number, all relevant data on the submitted facts must be provided together with the application. Thus, no information should be withheld that could have an influence on the decision of the tax authority. Of course, all information must be true. Circumstances relating to the situation that are in the past or that are expected in the future must also be included.

2.5 Structure of the application

The request for binding information should be divided into the following chapters: