People who have lost their jobs or are required to pay child support, single parents, and retirees: Many of those affected turn to the Beobachter Counseling Center in their deep despair. They do not have enough income to pay their taxes. They hold out great hope that their taxes will somehow be waived. But it’s not that simple. To receive a tax waiver, specific requirements must be met.
Who is eligible for a tax waiver?
The tax office grants a tax waiver only if the person concerned is in a situation of extreme hardship or if paying the tax would jeopardize their livelihood. However, there is no legal entitlement to a tax waiver.
Only individuals who have had an insufficient income over a long period of time and who also have no assets whatsoever have a chance of obtaining a tax waiver. If the financial hardship is only temporary, the only options available are a deferral or payment of the taxes in installments.
How do you apply for a tax waiver?
First of all, you must have your tax assessment in hand. Only then can you submit the application for tax relief. A general assessment is not sufficient. Based on the submitted documents, the responsible tax office calculates the applicant’s subsistence level. Tax relief will only be considered if the calculation shows that the applicant’s income is actually below the subsistence level. If that is not the case, there is no way around paying the taxes, at least in installments.
If, however, it is still not possible to pay the full amount of taxes or the agreed-upon installments on time, it is important to contact the tax office directly. You should not wait too long, as this can have negative consequences.
An application for a tax waiver can be submitted in person or in writing to the appropriate tax office. However, you should first gather all the necessary documents. These include, for example, pay stubs and pension statements, proof of rent (including utility costs), health insurance payments, and divorce documents.
For the tax waiver to take effect, the other creditors must waive their claims
If there are other debts to be repaid, a tax waiver can be granted only if the tax office is treated on an equal footing with the other creditors. The reason for this is that the tax waiver must benefit only the taxpayer in question and not the creditors. Through a so-called debt settlement agreement, in which all creditors waive a certain portion of their claims, a tax waiver can be granted to a certain extent.
If the tax office processes the request for remission, the accuracy of the assessment is no longer relevant. If the deadline for filing the tax return or the deadline for filing an objection is missed, one should no longer expect that a partial remission will retroactively correct the amount. In fact, the opposite is true: The tax office pays very close attention to whether the taxpayer has acted correctly and fulfilled all of their obligations to cooperate.
Filling Out Your Tax Return – Cooperation Is Extremely Important
If, despite a reminder, no tax return is filed, the required supporting documents are not provided, and the tax office therefore estimates the amount of taxes owed, the chances of receiving a tax waiver are extremely slim. This is particularly devastating for people who, through no fault of their own, were unable to cooperate in the collection of tax data due to personal problems or mental health issues. One example of such a case involves individuals with reading and writing difficulties, who find it very challenging to complete their tax return. This can result, for example, in being assessed a significantly higher tax liability each time. Therefore, we recommend that in a similar situation, you seek help in a timely manner—either by having someone assist you in completing your tax return or by applying for a support guardian through the Adult Protection Authority. An affordable tax return service is offered here.
If part of the taxes has already been paid, the tax office will only waive the outstanding amounts. If the payment was made subject to reservation, there is an exception. The taxes do not have to be paid. If the tax office grants the request, the tax does not have to be paid. This also applies in the rare case that the taxpayer regains assets in the future. If the tax office has received a certificate of loss following an unsuccessful seizure, the claims can still be collected for 20 years.
