Online message – Thursday 08/10/2023
Procedural Law | Income tax waiver in the event of factual inequity (FG)
The levying of income taxes can be factually unfair if the tax assessed, including losses on shares that have actually been paid but are not to be taken into account for tax purposes due to compensation restrictions, exceeds the annual subsistence level to be left tax-free (Cologne District Court, judgment of April 26, 2023 – 5 K 1403/21 ; Revision pending, BFH Az. IX R 18/23).
facts: The plaintiff suffered losses from written options. Due to the loss compensation limitation according to § 22 No. 3 sentences 3 and 4 EStG in the version of the disputed year, around €390,000 was not offset against the positive income from other types of income. This led to a correspondingly higher total amount of income. Taking into account the basic allowance of €7,235 applicable for 2002, the plaintiff requested a reduction in her total tax burden.
The lawsuit was successful:
According to the so-called subjective net principle, the state must allow a taxpayer as much of his/her earned tax-free as is necessary to cover the necessary subsistence (minimum subsistence level).
The basic requirement constitutes the constitutional lower limit for income tax access.
Regarding the exemption of the subsistence level
no overall view over several years
to do.
Rather, the amount of money that is actually and irrefutably required for subsistence is to be exempted from taxation in each assessment year.
A notice:
The decision is not final. The tax office has lodged an appeal against the judgment, which is being filed with the BFH under file number IX R 18/23. The full text of the decision is in
Jurisdiction database of the state of North Rhine-Westphalia
published.
Those: FG Cologne, press release from 10.8.2023 (il)
Source(s):
NWB UAAAJ-45949