An objection against an incorrect tax assessment (Steuerbescheid) can be filed within a one-month deadline following notification, as governed by Section 355 of the German Fiscal Code (Abgabenordnung, AO). Anyone who misses this deadline risks the assessment becoming final and unappealable, meaning that even obvious errors can no longer be corrected.
This guide explains when an objection is worthwhile, how the deadline is calculated, which form must be observed and what happens after it has been filed. Using concrete examples, we show what matters in practice.
When is an objection against a tax assessment worthwhile?
An objection may be considered whenever the tax assessment deviates from the submitted return, the tax office has not recognised expenses, or calculation errors have occurred. Common grounds include income-related expenses (Werbungskosten) not taken into account, rejected special expenses (Sonderausgaben), incorrect determinations of income, or doubts about the tax assessment of a given set of facts.
An objection may also be worthwhile if a comparable proceeding on a disputed legal question is pending before the tax office or in case law, in order to keep one's own case open. The tax office can then suspend the proceeding pursuant to Section 363(2) AO until the fundamental question has been clarified.
However, not every objection leads to an improvement. The tax office reviews the entire assessment anew, meaning that a higher tax assessment is also possible as a result. More on this later.
What deadline applies to the objection?
The objection deadline is one month following notification of the tax assessment, pursuant to Section 355(1) AO. For an assessment sent by post, the notification presumption under Section 122(2) no. 1 AO applies: the assessment is deemed to have been notified on the third day after being posted, regardless of when it actually arrives in the letterbox.
Example: A tax assessment is dated 2 May (Thursday). The third day after posting is 5 May. The objection deadline then runs until 5 June, 24:00. If the deadline falls on a Saturday, Sunday or public holiday, it is extended to the next working day pursuant to Section 108(3) AO.
How is the objection filed correctly?
The objection must be filed with the tax office in writing, electronically or recorded in a formal record, pursuant to Section 357(1) AO. It must make clear which assessment it is directed against and should name the taxpayer as well as the reference number of the assessment.
A statement of grounds is not mandatory at the time of filing, but should be submitted as promptly as possible so that the tax office can review the matter. The following details belong in an effective letter of objection:
- name, address and tax number of the taxpayer - date and reference number of the contested assessment - an express declaration that an objection is being filed - where possible, a brief statement of grounds referring to the points contested - signature in the case of written filing
What happens after the objection is filed?
With the objection, the entire tax assessment is reviewed again, not just the contested point. This means that the tax office can also correct errors to the detriment of the taxpayer pursuant to Section 367(2) AO, known as the reformatio in peius (Verböserung). Before such a change to the taxpayer's detriment, however, the tax office must grant the right to be heard and provide the opportunity to withdraw the objection.
An objection generally does not suspend the enforcement of the assessment. Anyone who does not wish to pay the assessed tax provisionally must additionally file an application for suspension of enforcement (Aussetzung der Vollziehung) pursuant to Section 361 AO. This will be granted if there are serious doubts about the lawfulness of the assessment or if enforcement would constitute an unreasonable hardship.
The tax office can uphold the objection in whole or in part, reject it, or, with the taxpayer's consent, suspend it, for example with regard to a test case before the Federal Fiscal Court (Bundesfinanzhof, BFH).
What happens if the deadline is missed?
If the objection deadline is missed, restoration to the previous status (Wiedereinsetzung in den vorigen Stand) may be applied for under certain conditions pursuant to Section 110 AO. The prerequisite is that the deadline was missed without fault, for example due to sudden serious illness or a demonstrable delivery error.
The application for restoration must be filed within one month of the impediment ceasing to exist, and the omitted act, i.e. the filing of the objection, must be made up within this deadline. Mere work overload or a mistake about the legal situation is generally not sufficient for restoration.
If the deadline is definitively missed and no grounds for restoration exist, the tax assessment becomes final. A change is then only possible via the narrow correction provisions of Sections 172 et seq. AO, for example in the case of new facts pursuant to Section 173 AO.
How do things proceed after an objection decision?
If the tax office rejects the objection by way of an objection decision (Einspruchsentscheidung), the path to the tax court remains open. The action must be filed with the competent tax court within one month following notification of the objection decision, pursuant to Section 47 of the Fiscal Court Code (Finanzgerichtsordnung, FGO).
If the tax office fails to process the objection at all over a longer period, an action for failure to act (Untätigkeitsklage) may be considered under the conditions of Section 46 FGO, though generally only after six months have elapsed without a substantive reason for the delay.