tax authorities are entitled to examine a taxpayer’s tax documents

The tax authorities are entitled to examine a taxpayer’s tax
documents and records to verify whether proper payment of
taxes has been made by paying an actual visit to the taxpayer’s
premises.

Large-scale businesses are to be audited three years
back in intervals of three years to ensure uninterrupted auditing.
In addition, special audits may be carried out in particular to
verify correct VAT payment. The taxpayer is obliged to produce
the documents requested by the tax auditors, such as account-
ing and other business records.

If data has been generated by
means of electronic accounting systems, the tax authorities
are entitled to inspect stored data fles. If documents are not
produced within a reasonable period of time, a default fee of €
2,500 to € 250,000 may be assessed. As a consequence of a tax
feld audit, tax base amounts and tax assessment notices may
be revised.