The Saxon Tax Court has ruled that the tax office may exceptionally estimate the number of family trips home in the case of dual household management. In the case in dispute, contrary to the information previously provided, family journeys home were made with a carpool and paid for in cash, which is why the evidence was not available.
Practical example:
The plaintiff claimed in his income from employment that he had made 43 family trips home by train, each covering a distance of 396 kilometers, as part of his double household management. He was unable to provide receipts for the train journeys made. The tax office therefore disregarded the family journeys home when carrying out the assessment. After an unsuccessful appeal, he filed a complaint and claimed that he had not actually made the family journeys home by train, but had used carpooling options that he had booked in an app. He was unable to provide any receipts for this, as the drivers had been paid in cash. The original statements were therefore untrue.
The tax court considers the requirements for an estimate to be fulfilled.
The lawsuit was successful because the tax office had completely disregarded the family journeys home. Due to the new circumstance that the costs for family journeys home could not be proven on the basis of cash payments, the tax court was of the opinion that the family journeys home should be taken into account by way of an estimate.
As no evidence could be provided, the tax court considered the requirements for estimating income-related expenses in accordance with Section 162 AO to be met. The tax court considered it reasonable that the booking of the carpooling opportunities in an app could no longer be documented more than a year later. Accordingly, it estimated two family trips home per month for 10 months (due to vacation and non-working days).
The taxpayer could be accused of not taking precautions to provide evidence (e.g. by taking screenshots when booking the carpooling). When making an estimate in accordance with Section 162 (1) AO, it was therefore necessary to take into account that the taxpayer should not be in a better position than a taxpayer who properly keeps receipts for his income-related expenses. The tax court therefore only took into account the claimed number of family trips home to a reduced extent.
In principle, the taxpayer bears the burden of proof when claiming tax-reducing circumstances such as travel expenses for family trips home. The taxpayer has the burden of proof, i.e. they must prove or at least provide credible evidence that they have actually incurred the expenses claimed. If they fail to meet this obligation, the tax office is generally entitled to disallow the claimed expenses.
In the case in dispute, the revoked statement in the tax court proceedings that the journeys had been made by train resulted in a different situation insofar as the new submission that the journeys had been made as a passenger for a cash payment appeared at least credible to the tax court.