GRP Rainer LLP

Mandatory Reporting of Untaxed Assets in the Inherited Property

Heirs of tax evaders can eventually face prosecution, as lately tax investigation is more and more concerned about tax evasion.


North Rhine-Westphalia, Germany -- (SBWIRE) -- 12/13/2012 -- GRP Rainer lawyers and tax advisors in Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: One should expect even in the future a rigorous prosecution of tax evaders. This was confirmed by the recent acquisition of computer data in Switzerland. This seems to threaten not only the money investors. Their heirs may become equally obligated to report immediately to the tax office the untaxed assets in the property inherited by them.

Money transactions in Switzerland became evidently popular in the early 1980s with some Germans. It helped partly evade the German tax office, as the taxable interest was not reported in Germany. Many of these tax evaders have died in the meantime, so that now the heirs are in possession of their money.

The Bar Association of Freiburg has advised all the heirs to verify carefully whether an inheritance can fully or partially consist of tax-evaded money. In case of reasonable suspicions they are advised to consider a possibility to wave the heritage. However, a lot of unprepared people cannot estimate their inherited property reliably. It is therefore advisable for every heir to seek a qualified legal advice. They will have to keep tight deadlines in mind. The heirs have only six weeks to waive the succession. Upon expiry of this term they may be obliged to accept the inherited property.

Heirs of an estate have different rights and obligations. One of those obligations is the submission of a complete tax declaration to the tax office. This comprises also reporting all untaxed assets in the estate to the tax office. Non-observance of the obligation to make such a declaration can be considered as a tax evasion. Such behavior may also result in criminal prosecution.

A voluntary disclosure may be a solution in certain cases. Through a voluntary disclosure to the tax office the respective person can in certain cases be relieved of criminal responsibility. However, the discovery of the fact by the competent authorities makes such a voluntary disclosure impossible.

Therefore, a self-exculpatory disclosure is recommended only with the help of a lawyer. In the case of doubts you should consult an experienced lawyer.

About GRP Rainer LLP is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, and Stuttgart, Germany and London UK.

Michael Rainer
Lawyer, Managing Partner

GRP Rainer LLP
Hohenzollernring 21-23
50672 Cologne

Phone: +49 221-27 22 75-0
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