Consequence of not paying German taxes

[Cindylw 0]

On 1/10/2015, 11:12:18, PandaMunich said:

You are obliged to file a tax return for 2014.

If you do not file, the Finanzamt will estimate your income, and believe me, they will estimate it much too high.

If you then do not pay the tax on that high estimated amount, they will foreclose on everything you have in order to get that tax (VAT, income tax and solidarity tax).

 

If you don't have anything the Finanzamt can foreclose upon in Germany, then should you ever fly via a German airport you will be arrested and put into a cell until you pay that estimated tax.

 

To round this off, this estimation of your income doesn't mean that you now can forget about doing the 2014 tax return: you still have to file it, and should your real income be less than the estimate, then you won't get the overpaid tax back.

 

If it is more than the estimate then you have to also pay that additional amount.

 

 

On 1/11/2015, 1:42:55, Mik Dickinson said:

Oh and believe me i worked in the Münich airport for 2 years.They get a lot of poeple that are just flying in transit.The German system is like their cars very very efficient

 

I am not sure where you guys got the information about getting arrested at the german airport, being putting into jail, and needing to pay the whole tax to get released.

 

I found information about the most severe measure in case of unpaid tax debt: https://www.heckmann.net/haftbefehl-gerichtsvollzieher/

 

The most severe measure tax authority can do is to apply for haftbefehl which is so-called "arrest" warrant just to get your asset information. This "arrest" warrant is just a civil one, not the criminal one. Once you give out your asset information, this warrant will be invalid and you will no longer be detained(not from jail!). The creditor(i.e. tax authority) would not easily apply for such arrest warrant because of high opportunity cost unless they believe debtor own any property assets. Normally, police, custom, or control would not have such information of arrest warrant. 

There is no law stating one needs to pay the tax debt in full to get released from jail  .

 

This is what I understand. Please correct me if I am wrong.

[JN53 304]

 

46 minutes ago, Cindylw said:

 Please correct me if I am wrong.

 

While I can't say that you are wrong, I do know that Panda is a very highly respected member of this forum and I have never been led wrong by any information she has posted from her vast knowledge of German taxes. I would always tend to believe what Panda says.

[Guest]

7 hours ago, Cindylw said:

 

 

I am not sure where you guys got the information about getting arrested at the german airport, being putting into jail, and needing to pay the whole tax to get released.

 

I found information about the most severe measure in case of unpaid tax debt: https://www.heckmann.net/haftbefehl-gerichtsvollzieher/

 

The most severe measure tax authority can do is to apply for haftbefehl which is so-called "arrest" warrant just to get your asset information. This "arrest" warrant is just a civil one,

 

But that is only one reason for imprisonment, the coercive one. That is civil law. 

 

Other grounds for imprisonment are of a criminal nature, i.e. they are based on offences such as fraud, tax evasion or as a substitute imprisonment for failure to pay a fine. 

 

[Mik Dickinson 438]

yeh sure when i was working at the airport i was informed to take a piece of baggage belonging to the guy to an office.Inside was an american guy and he was well pissed off blasting is mouth off.The people inside the office were not impressed and i offered my service to translate.They thanked me for it.i told the guy he was being held as there he had forgotten to pay parking fines while borrowing someones car in Münich.The case was just about a year old.He said it was not him and he wanted his righta as an american citizen respected.The people in the office told him they respect the rights of everyone in Germany not just Americans.It was a  fine for €25 which he finally paid but only after e realised he had missed his connection flight

[amatos 0]

Short term story...

In 2013 i move out to Germany and during 6 month worked as a freelancer, earning 24000 euros plus VAT (4560 euros) during that time. On the beginning of 2014 got a job contract and since than i thought that my freelance status was gone (although i knew i had to take care of the invoices)

Unfortunately i procrastinated since 2013 until the present moment regarding those invoices and i got my bank account frozen after getting a letter from the finance with a debt of 52.000 euros, basically they calculated all my years since i´ve been in Germany as a freelancer.

I have the letters at home but i didnt react since i was in my home country for more than 2 month. Im completely lost here trying to find a tax counselor (thats what the finance told me to do) to start taking care of my situation.

Since 2014 all my taxes were pay by my company, i even pay for church, and whats bothering me more its that more than half of this debt its penalty's from the last 5 years and has been told to me that i cant do nothing regarding it.

I fell like im being crucified here. what should i do? Of course i want to pay what i own them, but countless penalty's after penalty's are just insane, legally what can i do? Can i request forgiveness,? i know it sounds silly but i cant afford this, theres no way i can afford this. :( i´m the person in the world with less knowledge about financial laws in Germany, but.. there should be a way right? i dont make that much money.

[balticus 1,882]

@amatos - Hire a Steuerberater (Tax Advisor )to take care of this.   If your German is not fluent, i.e. sufficient to discuss tax issues, try to find a someone who speaks your native language or English.    If you try to save money by doing it yourself, it will probably cost much more.  

 

 

[amatos 0]

I'm on my way to one now... Even if I have to pay a entire month of salary... I agree... Thanks for the fast reply, fell like I'm not alone...

[amatos 0]

Does this fell right? I only worked about 7 month in 2013

[balticus 1,882]

Your Steuerberater can give better advice. 

 

If I remember correctly, your Umsatzsteuer estimate will be based on what you paid the previous year adjusted by any additional information you or your SB would provide to the Finanzamt.  

 

Since you didn't inform the Finanzamt that you were no longer freelancing, they assumed you are still freelancing.  

 

Did you not receive any communication from the Finanzamt about a failure to pay ?    To be honest, I am surprised it took five years for this to catch up with you.   

 

[El Jeffo 39,656]

No, definitely not. They took your freelance income from 2013 and projected it through 2019, although you say you stopped working freelance by 2014.

 

The only question is whether you've ignored their letters long enough for the objection deadline to have expired, which could mean their estimate is now considered final and legally binding, without any chance of further appeal on your part. I hope not, for your sake.

 

And for everyone out there reading this: never, NEVER ignore any correspondence from the Finanzamt.

[swimmer 3,706]

Absolutely.  And you must get the advice too. Top priority - fight for this money.  It is a big sum, most of the rest of us would scrap for it.  No doubt a lot of us feel the pain.   

 

The other thing (for other people) is to never let your tax status get too out-of-date. Getting out of what we are no longer part of would be high on the list.  Formally de-register from freelancing.  Some places have a form to complete, others just need a letter.    Again, high priority to follow through to see that is recognised.  Tracing people, finding bank accounts, picking you up by flight information (per the Kindergeld one yesterday) etc all much easier now and the authorities really use that stuff.

 

Update -  Thinking more, if you have not done this, I think you need to pull all of the paperwork together (including key employment papers) and make a list of everything you did in that period relating to this.   This is mainly about concrete facts, not vague  statements or ambiguity or "long time ago, cannot quite remember".  You should not give it to anyone in writing (not even an advisor) but you could build a standard verbal narrative, and keep a case file.  An advisor will also be greatly helped by this.   Looking at paperwork and records can also trigger memories.   ELSTER has a history and do not forget e.g. data backups that may have old output. Make a list of everything declared, certified, paid.  

With the sum at stake, a time investment is usually essential.   I had to protect that sort of sum recently in a different setting and I could only say:  right now, it is my top priority, I have to do what it takes, and I took some "second opinion" advice, and would have gone more formal on that if needed.  And that was just a cash risk to us.  There was not much other risk, such as to our reputation and prospects, that not paying tax or any large debt etc and frozen bank accounts etc can bring.

[wanderboy 1]

HI! I'm hoping to revive this thread since I'm in a similar position. So I'm facing the "Consequences of not declaring tax" - on time.

 

I was registered as a freelancer from 2017, but I actually didn't do any freelance work from then on since all the contracts that I had wanted me to work full time. I transfered work on 2018 and still was employed full time with an unbefriestet contract. 

 

I did not inform finanzamt of this, but I was constantly and automatically paying taxes because of my employer, so I assumed I don't have to declare anything. Then letter piled up and to me from Finanzamt about a fine and now on their 3rd letter saying I have to pay 2000€ fine. I consulted a friend and he told me that I should have still filed my tax declation even if it is zero. I just signed up at Elster today and send reply mails to finanzamt by post. He also said that the fines might be waived if I wrote them a letter saying I did not ear anything.(which I just did)

 

My question is, do you think they will still proceed with the fine? I really can't pay it. :( I am now really going to answer all their letters and will also declare everything after I get my log-in from Elster. 

 

And now with the current crisis going on, I am planning to go back to being freelance since I lost my job. By the way, my work permit allows me to do both freelance work and regular full-time work. SO my plan now is just to inform finanzamt all the time,

 

I'd appreciate any advise. I also don't think I can hire a steuerberater. Unless they are cheap, since I don't have that much budget for that for now.