The advance on costs
Proceedings before the Tax Court are subject to a fee.
The procedural fee becomes due when the action is filed - but not in the case of applications for preliminary legal protection. You will receive an invoice for costs shortly after the action has been filed. If the amount in dispute cannot be derived directly from the statement of claim and its annexes, or if the amount in dispute would fall below the minimum amount of € 1,500, this minimum amount in dispute will be used as a basis. If the minimum amount in dispute is accepted, court fees of €312 are to be paid provisionally.
When the proceedings have been concluded, the amount in dispute will be calculated by the clerk and a final bill of costs will be drawn up, taking into account the advance paid.
It should be noted, however, that the minimum amount in dispute cannot be less than €1,500 (exceptions: Applications for provisional legal protection and actions in child support matters).
The amount in dispute
The amount of court fees (and those of a legal representative) depends on the amount in dispute. This is usually the amount in dispute. If, for example, the lawsuit is about the recognition of income-related expenses in the amount of € 2,000, the individual income tax rate of the plaintiff is relevant. For an unmarried person with a taxable income of €40,000 in 2020, these additional income-related expenses mean a tax saving of over €700.
The procedural fee
The procedural fee at the tax court for the legal action is 4.0 times the rate of a simple value fee in accordance with Section 34 of the Court Costs Act. For proceedings of provisional legal protection, in particular if the execution of a decision is to be prevented for the time being, the 2.0-fold rate of the simple value fee is to be charged.
If the proceedings are not terminated by a judgment, but the action or application is withdrawn in due time, the procedural fee is reduced to 2.0 times (action proceedings) or 0.75 times (proceedings for provisional legal protection). However, this is only possible until the end of an oral hearing or, if such a hearing does not take place, before the written judgment or the court order is handed over to the court registry. This shall also apply if the parties have reached an agreement during the proceedings and declare the main matter to be settled.
Expenses of the parties
You may be reimbursed for your expenses incurred in pursuing the legal action if the court has so decided. If you win the case and the tax authority is ordered to bear the costs of the proceedings, you can demand reimbursement of these expenses, including the costs of an authorized representative in accordance with the Fee Ordinance. If a tax advisor or attorney was also required for the preliminary proceedings, these costs are also reimbursable according to the Fee Ordinance upon your request and the corresponding decision of the court.
However, the tax authority will not be reimbursed for its expenses - even if it wins.
If you are not in a position to bear the costs of proceedings, you can apply for legal aid. The tax court will grant this if the action has a reasonable chance of success and your income and assets do not exceed the statutory limits. In order to assess this, it is necessary for you to substantiate your claim and disclose your financial circumstances. You may also be allowed to pay the court costs in installments.