Voluntary disclosure under German law

Section 371 of the Fiscal Code and its tightening

The German instrument for regularising undeclared income is the voluntary disclosure (Selbstanzeige) under § 371 AO. A taxpayer who corrects or completes his incorrect or incomplete tax returns, or files returns he had omitted, and who pays the evaded tax within the period set for him, is exempt from punishment for tax evasion, unless one of the bars to exemption applies, for example because a tax audit has been announced or the offence had already been discovered and the taxpayer knew or should have expected this. The institution is old. Its justification has always been fiscal: it opens previously unknown sources of revenue and rewards the return to honesty. The events of 2008 to 2012 turned it from a marginal provision into one of the most important instruments of German tax enforcement, prompting the legislature to tighten it twice.

The first tightening followed a decision of the Federal Court of Justice (Bundesgerichtshof) of 20 May 2010 (1 StR 577/09), which held that a voluntary disclosure could only lead to exemption from punishment if the taxpayer returned fully to tax honesty. The Act to Combat Undeclared Money (Schwarzgeldbekämpfungsgesetz), which entered into force on 3 May 2011, codified this principle. It abolished the partial voluntary disclosure, so that a disclosure became effective only if it covered all unprosecuted offences in respect of the same type of tax. It barred disclosure once a tax audit had been ordered and excluded exemption from punishment where the evaded tax exceeded 50,000 euros per offence. In such cases § 398a AO allowed the prosecution to refrain from proceedings if the taxpayer paid, in addition to the tax, a surcharge of 5 per cent.¹

The second tightening came with the Act to Amend the Fiscal Code and the Introductory Act to the Fiscal Code of 22 December 2014, which applied from 1 January 2015. It halved the threshold above which exemption from punishment was excluded to 25,000 euros per offence and replaced the uniform surcharge under § 398a AO with a graduated scale: 10 per cent of the evaded tax up to 100,000 euros, 15 per cent up to one million euros and 20 per cent above that amount. The taxpayer must also pay the interest on evaded taxes (Hinterziehungszinsen) under § 235 AO within the period set. The disclosure must cover at least the last ten calendar years for all tax offences of the same type.² Taxpayers with Swiss accounts who had not yet regularised their affairs thus faced a clear deadline. Whoever disclosed before the end of 2014 paid less than whoever disclosed later.

The volume of disclosures

The result was a wave of disclosures without precedent. Each purchase of data, each report of a bank settlement and each tightening of the law produced a new peak. According to a survey of the finance ministries of the Länder by the Handelsblatt, about 40,000 voluntary disclosures were filed in 2014, the last year before the stricter rules took effect. The number fell to 15,120 in 2015 and to 4,373 in 2016.³ The large majority of the disclosures of these years concerned accounts in Switzerland. The total number since 2010 is therefore likely to run into six figures, and the revenue generated for the German public budgets into several billion euros, as the North Rhine-Westphalian figures quoted above indicate.

A parallel wave took place in Switzerland itself, where the straflose Selbstanzeige, the penalty-free voluntary disclosure introduced for direct taxes in 2010, allowed Swiss residents to regularise undeclared assets once in their lifetime. The Neue Zürcher Zeitung estimated in 2019 that between 100,000 and 150,000 private individuals had made use of it since 2010 and that they had declared assets of 40 to 50 billion francs. In 2018 alone about 40,000 disclosures were filed, shortly before the automatic exchange of information with Switzerland’s neighbours began.⁴ Many of these disclosures concerned Swiss residents of German origin. Conversely, many German residents with Swiss family connections had to coordinate disclosures on both sides of the border.

The Hoeneß case

One case came to symbolise the whole period. Uli Hoeneß, the president of FC Bayern Munich, held undeclared assets in an account at the Zurich bank Vontobel. He filed a voluntary disclosure on 17 January 2013, a few weeks after the withholding tax agreement had failed in the Bundesrat. The disclosure was incomplete. On 13 March 2014 the Regional Court of Munich found that he had evaded at least 28.5 million euros in taxes and sentenced him to three and a half years’ imprisonment. The presiding judge described the disclosure as insufficient and observed that Hoeneß had had many years to regularise his affairs but had played for time and acted only out of fear of imminent discovery.⁵

The case taught German clients of Zurich banks three lessons. A voluntary disclosure had to be complete to be effective, which required full documentation from the Swiss bank for every year concerned. The timing mattered, since a disclosure filed after the offence had been discovered offered no protection. Prominence, finally, offered no shield. For the Zurich banks, the case demonstrated the value of a well-organised process for providing German clients with complete tax statements and account histories, a service that became part of the standard offering of every bank with a German clientele.

Notes

1. Rudolph Rechtsanwälte, “Neuregelung der strafbefreienden Selbstanzeige im Steuerstrafrecht (Änderung 2011)”, https://www.rudolph-recht.de/neuregelung-der-strafbefreienden-selbstanzeige-im-steuerstrafrecht/, on the decision of the Bundesgerichtshof, the entry into force on 3 May 2011, the abolition of the partial disclosure, the new bar after an audit order, the threshold of 50,000 euros and the 5 per cent surcharge. ↩
2. REB Steuerberatung, “25.000-Euro-Grenze und Strafzuschlag: Selbstanzeige bei höheren Hinterziehungsbeträgen”, https://reb-steuerberatung.de/insights/25-000-euro-grenze-und-strafzuschlag-selbstanzeige-bei-hoeheren-hinterziehungsbetraegen.html, on the law of 22 December 2014, its application from 1 January 2015, the threshold of 25,000 euros and the graduated surcharge. ↩
3. Legal Tribune Online, “Zahl der Selbstanzeigen bricht ein” (cited above), with the figures for 2014, 2015 and 2016 and the breakdown by Land for 2016, in which Baden-Württemberg recorded 1,151 disclosures, Lower Saxony 926 and North Rhine-Westphalia 655. ↩
4. “Zehntausende Steuerhinterzieher zeigen sich selber an”, Neue Zürcher Zeitung, 2019, https://www.nzz.ch/schweiz/zehntausende-steuerhinterzieher-zeigen-sich-selber-an-ld.1457853. ↩
5. “Uli Hoeness zu 3½ Jahren Haft verurteilt”, 20 Minuten, 13 March 2014, https://20min.ch/finance/news/story/Uli-Hoeness-zu-3--Jahren-Haft-verurteilt-10715584. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.