Corona crisis: relief for taxpayers

The tax offices grant straightforward adjustments to advance tax payments and deferrals and waive late payment penalties for affected taxpayers.

The financial administration has responded to the Corona crisis with a series of relief measures that have also been granted in this or a similar form in the case of natural disasters and other crises. So far, this has primarily involved measures to ensure the short-term liquidity of companies. Further measures beyond the following points, for example with regard to filing deadlines, are already being discussed, but still require coordination between the federal and state governments.

• Advance payments: With an application for adjustment of advance payment, a reduction of advance payments on income tax and corporate income tax is possible for 2020 without any special requirements. The tax office may also adjust the trade tax assessment amount for prepayment purposes. Applications for adjustment of prepayments that only concern periods after 2020 must be specially justified.

• Deferral: Directly and significantly affected taxpayers may apply for a deferral of taxes due by the end of 2020 by December 31, 2020, presenting their circumstances. The damages incurred do not have to be proven in detail in terms of value. When verifying the conditions for deferrals, the tax offices should not impose strict requirements. The tax offices are also to generally waive the charging of deferral interest at the rate of 6 %.

• Late fees: Until December 31, 2020, the tax offices are to waive or forego the assessment of late payment surcharges that are actually due for those affected.

• Enforcements: The tax offices are to refrain from enforcement measures for all payments in arrears or due by that date for income or corporate income tax in the case of persons directly and significantly affected by December 31, 2020.

• Business tax: Applications for deferral and remission of trade tax must be addressed to the respective municipality even in times of the Corona crisis, unless the assessment and collection of trade tax has been transferred by the municipality to the tax office.

• Sales & Payroll Tax: As a rule, the relief does not apply to the payment of declared sales or payroll taxes, as these are not income taxes. Relief is only conceivable here within the framework of an individual agreement with the responsible tax office. However, the tax offices in many federal states grant a partial or full refund of the special advance payment or agree to a temporary deferral of the sales tax.

• Other taxes: In the case of taxes administered by the customs administration (e.g. energy tax and air transport tax), the General Directorate of Customs has been instructed to accommodate companies in a comparable manner. The same applies to the Federal Central Tax Office.