I am a resident and work in Germany. I have a prior year income I did not report. I wish to do so now. If I come forward and declare and pay what will be penalty and tax? Will I suffer legal repercussions?
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in Germany there is a posibility to declare income subsequently without criminal consequences, § 371 AO.
So you will only have to pay interests (0,5 % per month) and extra charges for late declaration (maximum 10 % of the tax or 25000 Euros).
You won't have to pay interests for the first 15 months after the year the tax originated from.
The actual amount of tax cannot be calculated taking into account the possibilities of this media. Germany has one of the most complicated income tax laws in the world. This is why you have to fill out so many forms for the annual tax declaration.
If you decide to declare now using the privilege of § 371 AO, please ask for the help of a lawyer or at least a tax consultant, because their are a lot of small errors you can commit with the consequece that the privilege won't work out for you and the authorities still know about your income not declared.
It is especially important to declare anything tax-relevenat you haven't declared and which is not prescribed.
Forgetting one small detail will jeopardize the whole privilege.
I hope I was able to help you.
LL.M. in International Trade Law (Newcastle upon Tyne, UK)
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