Bundesgerichtshof (German Federal Court of Justice), order of 16 April 2026 — 1 StR 557/25, ECLI:DE:BGH:2026:160426B1STR557.25.0 · Full text (PDF, German)
The case
According to the findings of the Oldenburg Regional Court, a construction entrepreneur in the wind-farm business (sole shareholder and managing director of a GmbH) and his tax adviser had implemented a “tax optimisation model”: the contracts belonging to the GmbH were shifted, as a sham, to three companies in Portugal and Switzerland which had neither business operations nor staff; the entrepreneur held the shares through trustees, accessed the accounts at will and performed the contracts from his home (para 2). The profits for 2008 to 2012 were concealed in the GmbH’s corporation and trade tax returns; no returns were filed for 2013/2014; and the hidden profit distributions also went undeclared in the entrepreneur’s income tax returns for 2008 to 2015 — evasion, on the Regional Court’s calculations: around €1.945 million in the GmbH’s profit taxes and around €2.656 million in income tax (para 3). The Regional Court imposed aggregate custodial sentences of four years six months and four years two months and ordered confiscation of the value of proceeds of €2,656,694.67 against the entrepreneur (para 1). On the substantive-law challenge, the First Criminal Senate set aside the individual sentences for the income tax counts 2009 to 2015, both aggregate sentences and the confiscation order to the extent it exceeds €283,109.25 (income tax and solidarity surcharge 2008); the appeals were otherwise dismissed (operative part; para 5).
The court’s reasoning
The Senate restates the standard of its settled case-law: a conviction for tax evasion requires findings on the facts relevant for taxation — above all the parameters on which the tax computation rests; to determine the scale of the evasion, the tax that would have arisen by law on truthful declarations (the “target tax”) must be compared with the tax actually assessed too low as a result of the untruthful declarations (the “actual tax”); the difference is the amount evaded (para 7, citing BGH, order of 5 February 2026 — 1 StR 510/25, para 7).
The judgment fails that standard for income tax 2009 to 2015: the Regional Court established neither the content of the returns filed nor of the assessments issued, and instead simply applied the 25% flat rate for capital income (section 32d(1) sentence 1 of the Income Tax Act) to the amounts of the hidden profit distributions (para 8). That is legally erroneous “because it blanks out all other categories of income and parameters” — in the Senate’s words: “Income tax is not assessed on capital income in isolation. Such a deficient approach does not contain the required comparison of target and actual tax.” (para 8; unofficial translation). The Senate could not rule out that losses from other income categories (section 2(3) of the Income Tax Act) or other assessment periods (section 10d) affected the outcome; that the simplified computation produced minimum evasion amounts not operating to the defendants’ detriment was not sufficiently certain (para 8). On the merits, however, an income tax evasion is certain given the volume of the distributions — only its scale must be redetermined (para 8).
By contrast, the 2008 assessment period stands — there, return and assessment had been established and the computation, including the half-income method, was traceable (para 10) — as does the evasion of the GmbH’s profit taxes: shifting the contracts to the functionless foreign companies was a sham transaction (section 41(2) sentence 1 of the Fiscal Code, section 117(1) of the Civil Code); the profits remained subject to German corporation and trade tax, and the hidden distributions did not reduce them (section 8(3) sentence 2 of the Corporation Tax Act) (para 11). Confiscation tracks the computation strictly: it was set aside exactly to the extent that the evasion calculation does not hold — only the correctly computed amount of €283,109.25 from the 2008 period survived (operative part no. 1 c; para 5).
Where the decision sits in the case-law
The order is one half of a pair: for the target-actual standard it cites the order of 5 February 2026 — 1 StR 510/25, handed down a few weeks earlier (para 7), and continues the line on presentation requirements consolidated there. Newly accentuated is the limit of flat “rate times base” computations: even with the flat-rate capital income tax, which at first glance invites an isolated 25% computation, income tax remains an assessed tax — without reconstructing the content of return and assessment, the reference point of the “actual tax” is missing. At the same time, the order demonstrates the direct asset-side relevance of computation doctrine: confiscation of saved tax expenses stands and falls with the evasion calculation — here the secured confiscation sum shrank from €2.657 million to €283,109.25, with the remainder to be decided afresh on remittal. On substance, by contrast, the order is no change of course: the Senate expressly confirms its settled line attributing profits routed through functionless base companies (sham transaction, hidden profit distribution) (para 11, citing inter alia BGH, order of 6 September 2012 — 1 StR 140/12; judgment of 26 July 2012 — 1 StR 492/11).
The literature
Asset confiscation is where the defence literature engages: Dorn analyses saved tax expenses as a confiscable pecuniary advantage while making visible that not every arithmetically asserted tax position is an actually realised proceed of crime (Dorn, Einziehung im Steuerstrafverfahren, 2025, pp. 92–116). Spilker stresses that what was obtained must be determined autonomously under sections 73 et seq. of the Criminal Code and must precisely not be equated with the evasion amount within the meaning of section 370(4) of the Fiscal Code (Spilker, UR 2025, 521 [524]) — the order illustrates the practical consequence: if the tax computation falls, so does the skimming. From the prosecution’s perspective, Schützeberg confirms the dividing lines of asset attribution — advantages of the company are not automatically advantages of the shareholder, and the liability claim under section 71 of the Fiscal Code is itself no confiscable asset (Schützeberg, PStR 2025, 4 [6]). Quedenfeld/Füllsack point to the parallel security instruments under section 324 of the Fiscal Code and section 111e of the Code of Criminal Procedure, which can block the same claim twice over (Verteidigung in Steuerstrafsachen, 6th ed. 2025, Part 4 B.IV.3 marginal no. 1115, p. 519) — the reduction of the confiscation sum therefore relieves liquidity directly.
Three levels — kept strictly apart
Official headnote: No official headnote has been published. Operative proposition (para 7): to determine the scale of the evasion, the target tax arising by law on truthful declarations must be compared with the actual tax assessed; a computation which merely applies a tax rate to individual income items and blanks out all other parameters does not satisfy that standard (para 8).
Administrative practice: No express administrative guidance exists (as at 19 August 2026).
Our conclusion for the defence: Expressly our own assessment: the evasion computation is the most underestimated checkpoint of German tax criminal proceedings — and the most effective point of attack on appeal. Flat “rate times distribution” computations, widespread in audit reports and indictments, are no substitute for an assessment; they become assailable as soon as the content of returns and assessments, loss positions or loss carry-forwards have not been fully reconstructed. Because confiscation follows the computation, every computational error simultaneously reduces the skimming — and hence the liquidity — risk. No criminal-law promise lies in this: the convictions and the attribution via sham-transaction doctrine held in full — the gains here concern sentence and asset access, not the verdict.
Defence levers
- Challenge the presentation of the computation: Check whether the judgment establishes the content of returns and assessments — if not, the substantive-law challenge carries against both sentence and confiscation (paras 7–8).
- Run the full-assessment objection: Actively plead losses from other income categories (section 2(3) of the Income Tax Act) and loss deductions (section 10d) — they destroy the assumption of “non-detrimental” minimum evasion amounts (para 8).
- Decouple and quantify confiscation: Accept confiscation of saved expenses only to the extent of a viably computed evasion; use partial reversals immediately to reduce attachments and other security measures.
- Separate asset spheres: Savings of the company (profit taxes) are not what the shareholder obtained — verify the confiscation addressee and the flow of funds for each count (paras 3, 5).
- Shape the findings on remittal: After a partial reversal “together with the findings”, evidence-taking on the computation is reopened — this is where the defence’s alternative computations and expert tax submissions belong.
Defence assessment: POSITIVE · Keywords: evasion computation; target-actual comparison; confiscation; hidden profit distribution; flat-rate capital income tax; presentation requirements
FAQ
Why did confiscation of €283,109.25 survive?
Because the computation for the 2008 assessment period was sound: there the Regional Court had established return and assessment and computed the tax — including the half-income method — traceably (para 10). Confiscation tracks exactly the line between viable and deficient computation.
Does the order mean the conviction falls away?
No. The verdicts remained intact — apart from the sentences in the affected counts — and the Senate expressly ruled out that no income tax at all was evaded; only the scale is to be redetermined (para 8). This is a computation order, not an acquittal — predictions about the outcome of the retrial are not on.
Source box
- BGH, order of 16 April 2026 — 1 StR 557/25, ECLI:DE:BGH:2026:160426B1STR557.25.0 (court below: Oldenburg Regional Court, judgment of 28 May 2025 — 2 KLs 950 Js 15927/15 (55/19)).
- BGH, order of 5 February 2026 — 1 StR 510/25, ECLI:DE:BGH:2026:050226B1STR510.25.0 (target-actual standard, cited at para 7).
- BGH, order of 6 September 2012 — 1 StR 140/12; BGH, judgment of 26 July 2012 — 1 StR 492/11 (sham transactions/base companies, cited at para 11).
- Dorn, Einziehung im Steuerstrafverfahren, 2025, pp. 92–116; Spilker, UR 2025, 521 (524); Schützeberg, PStR 2025, 4 (6); Quedenfeld/Füllsack, Verteidigung in Steuerstrafsachen, 6th ed. 2025, Part 4 B.IV.3 marginal no. 1115 (p. 519).
Tax criminal proceedings with a confiscation or attachment order — and the computation stems from the tax audit? We examine the target-actual comparison, loss positions and the skimming volume. → Confidential first assessment
Map the tax and confiscation risks of your corporate structure in advance — before someone else’s arithmetic becomes the basis. → VAT CMS Quick Scan
Book your free 15-minute assessment →Or pick a slot now (Mon·Wed·Fri 10–12)