Tax court proceedings; filing a complaint with the tax court

Disputes before the fiscal courts can be brought before the fiscal courts of first instance.

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Citizens can take legal action before the tax courts against measures issued by the tax authorities in tax and customs matters. The statement of claim must identify the plaintiff, the defendant (e.g. the tax office), the subject matter of the claim, the decision of the tax office that is being challenged and the decision on the objection. The plaintiff must make it clear which decision he expects from the tax court. The statement of claim must be signed by hand. If the action is filed electronically, the relevant document/file should be provided with a qualified electronic signature of the person responsible in order to ensure that it is in writing (see Section 126a of the German Civil Code).

The court examines whether the plaintiff has fulfilled all formalities and whether their claim is justified. The court is not bound by what is presented by the plaintiff or the tax office. Instead, it determines all facts ex officio. The parties involved are granted the right to be heard. The plaintiff and the defendant tax office are given the opportunity to comment on all points that are to form the basis of the court's decision. If the plaintiff has complied with all formalities and the claim is justified, the court will uphold the claim.

Anyone can represent their own case before the tax court. However, a lawyer, tax consultant or auditor can also be appointed.

Due to the only two-tier court structure of the German fiscal jurisdiction, the only admissible legal remedy against the judgments of the fiscal court is an appeal to the Federal Fiscal Court.

Before a complaint can be filed with the tax court, an objection must first be lodged with the relevant tax office against the notice served. An action can only be brought after the tax office has rejected the objection.

The advance on costs

Proceedings before the tax court are subject to a fee.

The procedural fee is due when the action is filed - but not for applications for interim relief. You will receive a bill of costs shortly after filing the action. If the amount in dispute cannot be determined directly from the statement of claim and its annexes or if the amount in dispute is less than the minimum amount in dispute of € 1,500, this minimum amount in dispute will be used as a basis. If the minimum amount in dispute is accepted, preliminary court fees of € 312 are payable.

Once the proceedings have been concluded, the amount in dispute is calculated by the registrar and a final statement of costs is drawn up, taking into account the advance paid.

However, it should be noted that the minimum amount in dispute cannot be less than € 1,500 (exceptions: Applications for interim legal protection and actions in child benefit matters).

The amount in dispute

The amount of the court fees (and those of a legal representative) are based on the amount in dispute. This is usually the amount in dispute. For example, if the lawsuit is about the recognition of income-related expenses of € 2,000, the plaintiff's individual income tax rate is decisive. For an unmarried person with a taxable income of €40,000 in 2020, these additional income-related expenses mean a tax saving of over €700.

The procedural fee

The procedural fee at the tax court for legal proceedings is 4.0 times the rate of a simple value fee in accordance with Section 34 of the German Court Costs Act. For proceedings for interim legal protection, in particular if the enforcement of a decision is to be prevented for the time being, 2.0 times the rate of the simple value fee is to be charged.

If the proceedings are not terminated by a judgment, but the action or application is withdrawn in good time, the procedural fee is reduced to 2.0 times (action proceedings) or 0.75 times (proceedings for interim legal protection). However, this is only possible until the end of an oral hearing or, if no such hearing takes place, before the written judgment or court order is handed over to the court registry. This also applies if the parties have reached an agreement during the proceedings and declare the main matter to be settled.

Expenses incurred by the parties

You can be reimbursed for your expenses necessary for the appropriate prosecution if the court has so decided. If you win the case and the tax authority is ordered to bear the costs of the proceedings, you can demand reimbursement of these expenses, including the costs of an authorized representative in accordance with the Fees Ordinance. If a tax consultant or lawyer was also required for the preliminary proceedings, these costs can also be reimbursed in accordance with the Fees Ordinance at your request and if the court so decides.

However, the tax authority will not be reimbursed for its expenses - even if it wins.

Legal aid

If you are not in a position to bear the costs of proceedings, you can apply for legal aid. The tax court will grant this if the action has sufficient prospect of success and your income and assets do not exceed the statutory limits. In order to assess this, it is necessary for you to substantiate your claim and disclose your financial circumstances. You may also be granted payment of the court costs in installments.