Last Updated on May 31, 2021 by LawEuro
The Fiscal Code of Germany
Third Chapter
Competence of the revenue authorities
Section 16
Subject-matter jurisdiction
Unless otherwise stipulated, the subject-matter jurisdiction of the revenue authorities shall be determined pursuant to the Fiscal Administration Act.
Section 17
Local jurisdiction
Unless otherwise stipulated, local jurisdiction shall be determined by the following provisions.
Section 18
Separate determination
(1) The following shall have local jurisdiction with regard to separate determination pursuant to section 180:
1. in the case of agricultural and forestry undertakings, real property, business premises and mineral exploitation rights, the tax office in whose district the undertaking, real property, business premises or mineral exploitation right is located or, if the undertaking, real property, business premises or mineral exploitation right extends over the districts of several tax offices, the tax office in whose district the most valuable part is located (tax office of location),
2. in the case of commercial undertakings whose business management is located within the territory of application of this Code, the tax office in whose district the business management is located, in the case of commercial undertakings whose business management is not located within the territory of application of this Code, the tax office in whose district a permanent establishment – in the case of several permanent establishments, the economically most important one – is maintained (tax office of the undertaking),
3. in the case of income from independent personal services, the tax office from whose district the activity is predominantly performed,
4. in cases where income, other than income from agriculture and forestry, business or self-employment, is distributed among multiple persons and is determined separately in accordance with section 180(1), first sentence, number 2a,
a) the tax office in whose district this income is managed, or,
b) if it is not possible to determine where this income is managed within this Code’s territory of application, the tax office in whose district the most valuable part of the assets yielding the joint income is located.
This shall apply accordingly in cases of separate determination pursuant to section 180(1), first sentence, number 3 or section 180(2).
(2) Where separate determination is to be conducted with regard to several taxpayers and local jurisdiction cannot be determined pursuant to subsection (1) above, every tax office which, pursuant to sections 19 or 20, is responsible for taxes on income and on capital of a taxpayer to whom a share of the object of determination is attributable shall have local jurisdiction. Where because of an ordinance pursuant to section 17(2), third and fourth sentence, of the Fiscal Administration Act this tax office does not have subject-matter jurisdiction with regard to separate determination, the tax office with subject-matter jurisdiction shall take its place.
Section 19
Taxes on the income and capital of natural persons
(1) The tax office in whose district a natural person is resident or, in the absence of a residence, has his habitual abode shall have local jurisdiction over the taxation of that person’s income and capital (tax office of residence). In the case of multiple residences within the territory of application of this Code, the residence at which the taxpayer is predominantly present shall be decisive; in the case of multiple residences of a taxpayer who is married or in a civil partnership and is not permanently separated from his spouse or civil partner, the residence at which the family is predominantly present shall be decisive. With regard to persons subject to unlimited tax liability pursuant to section 1(2) of the Income Tax Act and section 1(2) of the Capital Tax Act, local jurisdiction shall lie with the tax office in whose district the paying public fund is located; the same shall apply in the cases referred to in section 1(3) of the Income Tax Act with regard to persons fulfilling the requirements of section 1(2), first sentence, numbers 1 and 2 of the Income Tax Act, as well as in the cases referred to in section 1a(2) of the Income Tax Act.
(2) Where the requirements referred to in subsection (1) above are not fulfilled, local jurisdiction shall lie with the tax office in whose district the assets of the taxpayer are located, and where this applies to several tax offices, the tax office in whose district the most valuable part of the assets is located. Where the taxpayer does not have any assets within the territory of application of this Code, the tax office in whose district the activity is or has been predominantly performed or exploited within the territory of application of this Code shall have local jurisdiction.
(3) Notwithstanding the provisions of subsection (1) above, where there are several tax offices in the municipality of residence and where a taxpayer with income from agriculture and forestry, business or self-employment performs this activity within the municipality of residence but in the district of a tax office other than the tax office of residence, the first tax office shall be responsible where it would have been competent for the separate determination of this income pursuant to section 18(1) numbers 1, 2 or 3. In applying the first sentence of this subsection, income from profit shares shall be taken into account only where it is the sole income of the taxpayer within the meaning of the first sentence.
(4) In applying subsection (3) above, taxpayers who must be or may be assessed jointly shall be treated as if their income were derived by a single taxpayer.
(5) The governments of the Länder may stipulate by way of ordinance that an area comprising several municipalities shall be considered a municipality of residence within the meaning of subsection (3) above insofar as this seems appropriate considering the economic situation, transport infrastructure, the structure of administrative authorities or other local needs. The government of a Land may delegate these powers to the highest authority of this Land responsible for revenue administration.
(6) In order to guarantee the taxation of persons who are subject to limited tax liability under section 1(4) of the Income Tax Act and who receive income as defined in section 49(1) numbers 7 and 10 of the Income Tax Act, the Federal Ministry of Finance may issue ordinances with the consent of the Bundesrat that assign, to one revenue authority, local jurisdiction for this Code’s territory of application. The first sentence above shall also apply where an application pursuant to section 1(3) of the Income Tax Act is submitted.
Section 20
Taxes on the income and capital of corporations, associations and pools of assets
(1) Local jurisdiction over the taxation of the income and capital of corporations, associations and pools of assets shall lie with the tax office in whose district the business management is located.
(2) Where the business management is not located within the territory of application of this Code or where the place of business management cannot be determined, the tax office in whose district the taxpayer has its registered office shall have local jurisdiction.
(3) Where neither the business management nor the registered office is located within the territory of application of this Code, local jurisdiction shall lie with the tax office in whose district assets of the taxpayer are located and, if this applies to several tax offices, the tax office in whose district the most valuable part of the assets is located.
(4) Where neither the business management nor the registered office or assets of the taxpayer are located within the territory of application of this Code, the tax office in whose district the activity is or has been predominantly performed or exploited within the territory of application of this Code shall have local jurisdiction.
Section 20a
Taxes on income in the case of construction services
(1) Notwithstanding the provisions of sections 19 and 20, jurisdiction with regard to the taxation of enterprises providing construction services within the meaning of section 48(1), third sentence, of the Income Tax Act shall lie with the tax office responsible for the taxation of the corresponding turnover pursuant to section 21(1) if the trader’s residence or the enterprise’s business management or registered office is not located within the territory of application of this Code. Notwithstanding sections 38 to 42f of the Income Tax Act, this shall also apply to the withholding of taxes on wages.
(2) Where foreign suppliers under section 38(1), first sentence, number 2 of the Income Tax Act provide workers for temporary employment, the tax office responsible for the taxation of the corresponding turnover pursuant to section 21(1) shall be responsible for administering wages tax. The first sentence shall apply only in cases where the person hired out is employed in the construction industry.
(3) As regards the taxation of persons employed in Germany by enterprises referred to in subsections (1) and (2) above, the Federal Ministry of Finance may, in derogation of section 19, issue ordinances with the consent of the Bundesrat that assign local jurisdiction for this Code’s territory of application to one tax office.
Section 21
Valued-added tax
(1) The tax office in whose district the trader wholly or mainly operates his enterprise in the territory of application of this Code shall have jurisdiction over VAT, excluding import VAT. As regards traders whose residence, registered office or place of management is not located within the territory of application of this Code, the Federal Ministry of Finance may, in order to ensure taxation, issue ordinances with the consent of the Bundesrat that assign local jurisdiction for the this Code’s territory of application to one revenue authority.
(2) For persons who are not traders, jurisdiction over VAT shall lie with the tax office responsible for the taxation of income in accordance with sections 19 or 20; in cases where section 180(1), first sentence, number 2a applies, jurisdiction over VAT shall lie with the tax office responsible for separate determination in accordance with section 18.
Section 22
Non-personal taxes
(1) Local jurisdiction over the assessment and apportionment of base amounts of non-personal taxes1 shall lie with the tax office of location (section 18(1) number 1) in the case of real property tax, and with the tax office of the undertaking (section 18(1) number 2) in the case of trade tax. Notwithstanding the provisions of the first sentence of this subsection, jurisdiction over the assessment and apportionment of base amounts of trade tax in the case of enterprises providing construction services within the meaning of section 48(1), third sentence, of the Income Tax Act shall lie with the tax office responsible for the taxation of the corresponding turnover pursuant to section 21(1), provided that the trader’s residence or the enterprise’s business management or registered office is located outside the territory of application of this Code.
(2) Where the tax offices are responsible for assessing, levying and recovering non-personal taxes, local jurisdiction shall lie with the tax office to whose district the municipality authorised to apply the municipal multiplier belongs. Where a municipality authorised to apply the municipal multiplier belongs to the districts of several tax offices, local jurisdiction shall lie with the tax office which is or would be responsible pursuant to subsection (1) above if only the parts of the enterprise, real property or business premises located in the municipality authorised to apply the municipal multiplier were present in the territory of application of this Code.
(3) Subsection (2) above shall apply mutatis mutandis where a Land is entitled to the tax revenue from non-personal taxes pursuant to Article 106(6), third sentence, of the Basic Law.
Footnote 1: Steuermessbetrag, calculated by applying multiplier (Steuermesszahl) to value of object to be taxed (property-Grundsteuer; earnings-Gewerbesteuer). The base amount of non-personal tax is then multiplied by the municipal multiplier (Hebesatz) to give the Grundsteuer or Gewerbesteuer
Section 22a
Jurisdiction on the continental shelf and in the exclusive economic zone
In those parts of the continental shelf and the exclusive economic zone belonging to the Federal Republic of Germany, the jurisdiction of Land revenue authorities in accordance with sections 18 to 22 or in accordance with tax legislation shall be based on the equidistance principle.
Section 23
Import and export duties, excise duties
(1) Local jurisdiction over import and export duties pursuant to Article 5 numbers 20 and 21 of the Union Customs Code and over excise duties shall lie with the main customs office in whose district the matter to which the respective law attaches the duty occurs.
(2) Local jurisdiction shall further lie with the main customs office from whose district the taxpayer operates his enterprise. Where the enterprise is operated from a location outside the territory of application of this Code, jurisdiction shall lie with the main customs office in whose district the trader wholly or mainly conducts his transactions in the territory of application of this Code.
(3) Where import and export duties pursuant to Article 5 numbers 20 and 21 of the Union Customs Code and excise duties are due in connection with a tax crime or tax-related administrative offence, local jurisdiction shall lie with the main customs office that has jurisdiction over the crime or offence.
Section 24
Surrogate competence
Where local jurisdiction cannot be derived from other provisions, the revenue authority in whose district the matter requiring the official act arises shall be responsible.
Section 25
Multiple local jurisdiction
Where several revenue authorities have jurisdiction, the revenue authority which was first charged with the matter shall decide unless the revenue authorities responsible agree on another revenue authority responsible or the common supervisory authority responsible determines that another revenue authority with local jurisdiction should decide. In the absence of a common supervisory authority, the supervisory authorities responsible shall reach a joint decision.
Section 26
Transfer of jurisdiction
Where local jurisdiction is transferred from one revenue authority to another due to a change in the circumstances establishing such jurisdiction, the transfer of jurisdiction shall occur as soon as one of the two revenue authorities becomes aware of this. The hitherto responsible revenue authority may continue with administrative proceedings where this serves to ensure that the proceedings are carried out simply and appropriately while protecting the interests of the participants, and provided that the newly responsible revenue authority agrees. There shall be no transfer of jurisdiction pursuant to the first sentence above as long as
1. a decision has not yet been taken on an insolvency petition,
2. open insolvency proceedings have not yet been cancelled, or
3. a partnership or a legal person is undergoing liquidation.
Section 27
Agreed jurisdiction
In mutual agreement with the revenue authority which has local jurisdiction pursuant to the provisions of the tax laws, a different revenue authority may assume responsibility for taxation, provided that the person concerned agrees. One of the revenue authorities referred to in the first sentence of this section may ask the person concerned to declare his approval within a reasonable period of time. Approval shall be deemed to have been given if the person concerned does not object within this period of time. The person concerned shall be explicitly advised of the consequences of remaining silent.
Section 28
Disputed jurisdiction
(1) Where several revenue authorities consider themselves to have jurisdiction or not to have jurisdiction, or where jurisdiction is doubtful for other reasons, the common supervisory authority responsible shall decide on local jurisdiction. Section 25, second sentence, shall apply accordingly.
(2) Section 5(1) number 7 of the Fiscal Administration Act shall remain unaffected.
Section 29
Imminent danger
In the case of imminent danger, local jurisdiction for non-deferrable measures shall lie with any revenue authority in whose district the matter requiring the official act arises. The authority otherwise locally responsible shall be informed without undue delay.
Section 29a
Assistance for tax offices with local jurisdiction as ordered by superior revenue authorities
To ensure the timely and consistent execution of tax laws, the highest revenue authority of a Land, or the Land revenue authority it authorises, may direct that a tax office with local jurisdiction receive full or partial assistance from another tax office in fulfilling the tasks involved the taxation procedure. The assisting tax office shall act on behalf of the tax office with local jurisdiction; the administrative actions taken by the assisting tax office shall be ascribed to the tax office with local jurisdiction.
Section 29b
The processing of personal data by revenue authorities
(1) Revenue authorities shall be permitted to process personal data if such processing is necessary for them to fulfil the functions incumbent upon them or to exercise the official authority with which they have been vested.
(2) Notwithstanding the provisions of Article 9(1) of Regulation (EU) 2016/679, revenue authorities shall be permitted to process special categories of personal data as described in Article 9(1) of Regulation (EU) 2016/679 to the extent that such processing is necessary for reasons of substantial public interest and to the extent that the interests of the controller in processing the data override the interests of the data subject. In such cases, revenue authorities shall provide for suitable and specific measures to safeguard the data subject’s interests; the second sentence of section 22(2) of the Federal Data Protection Act shall apply accordingly.
Section 29c
The processing of personal data for other purposes by revenue authorities
(1) In the course of performing their functions, revenue authorities shall be permitted to process personal data for a purpose other than that for which a revenue authority collected or recorded such data (further processing) if
1. such further processing serves to facilitate an administrative procedure, an auditing procedure, judicial proceedings in tax matters, criminal proceedings for a tax crime, or administrative fine proceedings for a tax-related administrative offence,
2. the legal conditions have been met that would permit the disclosure of such data in accordance with section 30(4) or (5) or if it is necessary to check whether such conditions have been met,
3. it is evident that such further processing is in the interest of the data subject and there is no reason to assume that the data subject would withhold his consent if he were aware of the other purpose,
4. such further processing is necessary for developing, reviewing or modifying the automated procedures of revenue authorities because
a) unaltered data are needed or
b) the anonymisation or pseudonymisation of such data is impossible or would require disproportionate effort.
In this connection, the use of personal data is necessary in particular if personal data from a number of different filing systems need to be unambiguously linked, and it is impossible or would require disproportionate effort to create suitable test cases.
5. such further processing is necessary for conducting regulatory impact assessments because
a) unaltered data are needed or
b) the anonymisation or pseudonymisation of such data is impossible or would require disproportionate effort,
or
6. such further processing is necessary for the exercise of supervisory, regulatory and disciplinary powers by revenue authorities. This shall also apply to the alteration or use of personal data by revenue authorities for purposes of training or testing, as long as the data subject has no overriding interests that merit protection.
In cases where number 4 of the first sentence above applies, the data may be processed only for the purpose of developing, reviewing or modifying automated procedures and must be deleted within one year after these measures have ended. In cases where number 6 of the first sentence above applies, the data may be processed only by persons who are required to observe tax secrecy in accordance with section 30.
(2) The further processing of special categories of personal data as described in Article 9(1) of Regulation (EU) 2016/679 shall be permissible if the conditions stipulated in subsection (1) above have been met and an exception under Article 9(2) of Regulation (EU) 2016/679 or under section 29b(2) applies.
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