date | theme

04. June 2021 | Investigative proceedings: When does the criminal tax proceedings run (this contribution)

27. April 2021 | Criminal Tax Proceedings: Procedure & Termination of the Investigative Proceedings

December 2, 2020 | Tax evasion and self-disclosure – easily explained and solved

17. September 2018 | Tax evasion: risk / penalty / intent / perpetrator / statute of limitations / notification

13. August 2017 | Self-disclosure in case of tax evasion

You have received mail from the financial law enforcement agencies of the Criminal Matters/Fines Office or the Tax Investigation Office and are requested to issue contracts, logbook or other documents. Are these bodies entitled to do so? And if so, why? If you hear from these agencies, you regularly think you are suspected of being a tax offender and a criminal tax investigation is under way. But especially with communications or requests by the tax investigation office you do not have to panic on a regular basis. Just a message from the tax investigation office does not mean that a criminal case is ongoing. Why this is so and how it comes to it we explain in this article.

In principle, a distinction must be made between two organizational models in the tax criminal proceedings of the financial law enforcement authorities. In one organizational model, the penalties and fines departments and the tax investigation departments form independent tax offices. This is the case in Lower Saxony, North Rhine-Westphalia and Hamburg. In the other federal states, the penalties and fines offices and the tax investigation offices are organizationally affiliated to one, not necessarily the same tax office. Relevant financial law enforcement agencies are nevertheless combined the criminal and fines departments and the tax investigation departments. The tasks and competences of these bodies are described below.

The prosecuting bodies of the criminal and fine authorities and the tax investigation authorities have different tasks.

The Criminal and Fine Office is responsible for determining the facts in the event of suspicion of tax evasion (§ 386 para 1 AO) and investigates, for example, whether the suspect acted intentionally. It is therefore mandatory to act within the framework of criminal tax proceedings. If you hear from the criminal and fines department, an investigation is under way for a tax offence against you.

1.2.1. Legal framework and tasks

Pursuant to Section 208 AO, the task of the tax intelligence office includes the investigation of tax evasions and tax offences in the presence of an initial precaution (§ 152 II StPO). One can, for example, be suspected of intentionally showing a too low tax in his tax return. This task is the central task of the tax intelligence agency. For this reason, the tax intelligence agency also acts in the investigation procedure. Furthermore, the tax intelligence office also has the task of determining tax bases in the context of research into tax evasion and tax offences. The tax intelligence office must therefore determine tax bases, on the one hand, for the purpose of determining the evasion success and, on the other hand, for the purpose of tax determination in the normal taxation procedure. This task shows that the tax intelligence agency acts as both a law enforcement authority and a taxation authority.

1.2.2.

Furthermore, the prior investigation, i.e. the detection and investigation of unknown tax cases, is an additional task of the tax investigation office. This task is important if there is no initial suspicion. If an initial concealment is present, the control search office already determines anyway. Nevertheless, even in the context of pre-investigations, the tax investigation must not carry out any investigation into the blue without any connecting point. This means, for example, that without concrete indications for not recording a tax-relevant situation, no further research may be carried out. In such a case, you may want to consider objecting to the tax ruling based on such investigative methods. Preliminary investigations are also used in tax proceedings and not yet in criminal tax proceedings. Therefore, you do not have to be afraid of a tax criminal procedure in this context.

1.2.3. Isolated fiscal determination

Therefore, the tax investigating authority can also act in tax proceedings, even if it is excluded that the findings can serve to determine the facts in the context of criminal tax proceedings. For this reason, it is possible that you will hear from the tax investigation office without being suspected of tax evasion or reckless tax reduction. This possibility is also referred to as isolated fiscal determination. Therefore, it becomes clear that only because the tax investigation office investigates, one does not have to be afraid that a proceeding for tax evasion is also under way. The tax intelligence agency can therefore draw up both a criminal and a tax audit report.

§ 388 AO regulates the territorial jurisdiction of the penalties and fines office. The relevant factors are therefore the place of the crime, the place where the offence was discovered, the tax jurisdiction, the place of residence or the habitual residence. In case of multiple allocation, the priority principle applies (§ 390 I AO). The decisive factor is therefore the financial authority, which first initiated criminal proceedings for the crime. The territorial jurisdiction of the tax intelligence office shall be determined by the tax office to which it belongs.

Furthermore, the competences of the Criminal and Fines Office and the tax investigation office in connection with tax evasion must be distinguished.

The competences of the Criminal and Fines Office depend decisively on whether it conducts the investigation independently (§ 386 II, IV S. 3 AO) or whether it acts as an independent auxiliary body of the public prosecutor's office.

3.1.1. Separate investigation procedure

The Criminal and Fine Office conducts proceedings independently if the offence constitutes exclusively a tax offence or a connecting act within the meaning of § 386 II No. 1 AO. This is the case if. In this case, the Criminal and Fines Office shall exercise the rights and obligations that the public prosecutor’s office is entitled to in the investigation procedure (§ 399 I AO). What competences does STA have

However, despite the independent investigative competence and the final competence within the meaning of § 400 AO, the tax authority may not determine the matter independently until the maturity of the charge without the participation of the public prosecutor. This means that the public prosecutor must also be involved in the investigation procedure. In addition, the public prosecutor's office can draw the proceedings at any time according to § 386 IV, so-called evocation. Since the criminal and fines office only has the investigative rights of the public prosecutor, it is not a penal enforcement authority within the meaning of § 451 para. 1 StPO. It cannot therefore execute the sentence if convicted. Nor can it use coercive measures. Therefore, for example, no evasion interest can be set.

If the penalties and fines office does not have the conditions for independent investigative competence, it has only the same rights as the authorities of the police service. For example, it must carry out investigations assigned to it by the public prosecutor’s office (§ 161 StPO). In addition, it has to investigate the crime and make orders to prevent the darkening of the matter. In this context, obscurity refers to measures which are suitable for destroying, modifying evidence or influencing witnesses and co-accused persons. To this extent, they are entitled to ask authorities for information or to demand it in the event of imminent danger. Furthermore, it may carry out investigations of any kind (§ 163 I StPO). In addition, it has so-called emergency powers according to §§ 399 II S. 2 AO. It may therefore order seizures, emergency disposals, searches, investigations and other measures.

In criminal tax proceedings, the tax intelligence office has the same powers and obligations that the StPO grants or imposes on officers of the police service (§ 404 sentence 1 AO). The officials of the tax investigation office are investigators of the public prosecutor’s office (§ 404 S. 2 AO). Furthermore, the tax intelligence office also has the emergency powers within the meaning of § 399 Abs. 2 sentence 2 AO. As a special right, it has the (independent) power to review documents (§ 404 sentence 2 1st half sentence AO). The competences do not depend on whether the penalties and fines office or the public prosecutor's office leads the investigation. It is important to note that these powers of the tax intelligence agency also stand to a certain extent for periods of law enforcement. This is the case if it is to be expected that, based on findings on already time-barred periods, there may be indications that are significant for non-barred periods.

In addition, the tax intelligence office has the taxation-related investigative powers that are vested in the tax offices (§§ 208 para 1 sentence 2 second case, 93 ff. It may therefore, inter alia, request information from interested parties and other persons or consult experts, request the production of documents or take inspections. Only these and no criminal investigative powers are to her in the case of the isolated fiscal investigation.

The decisive distinction between the criminal and fine office and the tax investigation office is therefore to be seen in the fact that the tax investigation office can also act in tax proceedings. This does not even require a criminal investigation. Therefore, the tax intelligence office also has competences within the tax procedure and can carry out investigations there. Therefore, you do not have to be afraid that you will be accused of tax evasion or reckless tax cuts. You can think about a decriminalized self-report. In criminal tax proceedings, on the other hand, it has only the competences of the police and therefore cannot conduct the proceedings independently and take enforcement measures. The penalties and fines office, on the other hand, can manage the criminal tax proceedings independently and has the same rights as the public prosecutor. If she does not lead the procedure independently, however, she only has the competences of the police.