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Bayern’s Hoeneß said to hide cash in Swiss bank

The president of German football club Bayern Munich, Uli Hoeneß, may have hidden more than €10 million ($13 million) from tax authorities, according to a Sunday media report.

Published: 21 April 2013 13:54 CEST
Bayern's Hoeneß said to hide cash in Swiss bank
Photo:DPA

Hoeneß, 61, revealed to Focus news weekly that he had voluntarily disclosed a Swiss bank account in January and is working closely with investigators on a tax evasion probe.

The football legend and prosecutors have declined to divulge the sums involved but Bild am Sonntag reported without citing its sources that Hoeneß had already paid nearly €6 million in back taxes.

The head of the German tax union, Thomas Eigenthaler, said that based on that sum, Hoeneß had likely hidden at least €10 million in income.

Hoeneß, who also draws income from a sausage company he co-founded, told Focus that he had originally planned to come forward after a planned German-Swiss tax accord came into effect, which would have allowed him to settle the matter anonymously with a one-off payment.

But the centre-left opposition torpedoed the measure late last year on the grounds that it unfairly offered criminal amnesty to tax dodgers.

Five months ahead of a general election, the opposition Social Democrats leapt on the high-profile case as proving their point about the flaws in the mooted Swiss tax pact.

“Once again we are so surprised when a prominent case of tax evasion comes to light,” SPD general secretary Andrea Nahles said in a statement.

“These cases are bad enough for the social cohesion of our country. But it is much worse when this behaviour is sanctioned by political leaders.”

However Philipp Rösler, leader of the pro-business Free Democrats, junior partners in Chancellor Angela Merkel’s ruling coalition, told Monday’s Bild newspaper that Berlin aimed to take a firm line against tax cheats and that without the accord with Switzerland, many cases would go undetected.

Although Switzerland has recently cracked down on undeclared funds in a bid to clear its reputation as a tax haven, it has so far doggedly refused to consider lifting its banking secrecy practices.

Bayern host Barcelona in the Champions League semi-final, first leg on Tuesday as the German champions bid to reach their third European Cup final in four years.

Bayern coach Jupp Heynckes played down the impact of the tax affair on the club.

“It’s a private matter for the president. There are often stories of this nature, especially in the Munich media, but it is of absolutely no interest to my team,” Heynckes said Saturday.

AFP/The Local/kkf

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READER QUESTIONS

EXPLAINED: Do I have to declare income from foreign sources on my German tax return?

If you're a resident in Germany, you will typically have to declare and pay tax on your worldwide income. But there may be some exceptions in certain cases.

Published: 3 May 2024 11:11 CEST
EXPLAINED: Do I have to declare income from foreign sources on my German tax return?

If you’re filling in a German tax return, you are generally legally required to declare and pay tax on all income you earn – wherever in the world you earn it. This is true even if you keep the money abroad.

In most cases, your worldwide income is subject to what’s called “unlimited tax liability” – which means that there’s no exemptions or discounts on your taxes for money earned abroad – whether its from work or capital gains like the sale of stocks. This is generally even true if Germany doesn’t have a Double Taxation Agreement (DTA) with the other country in question.

If, however, Germany does have a DTA – some of your tax might end up getting limited in Germany. This is generally providing that you’ve paid it in the other country.

For example, the US may apply a withholding tax to payments made to you for freelance services you provide in the US, for example. In this case, the DTA between Germany and the US would allow you to submit documentation proving that you’ve already paid tax on this payment in the US. That’ll prevent you from having to pay tax again in Germany on the amount that actually gets wired to your account.

READER QUESTION: How can I find a German tax advisor?

Who has a double taxation treaty with Germany?

Germany has concluded double taxation agreements with numerous – but not all – countries and territories. You can check out the German government’s dropdown menu here to see which countries are on the list.

German residents earning money in other EU countries should still check this list, as certain tax provisions may be unique to the two countries in question.

READ ALSO: Everything you need to know about paying taxes in Germany

What about rental income?

As a general rule, rental income is taxed in the country where the property is located, meaning you don’t have to declare or pay it in Germany. There are some notable exceptions – for example if the property is located in Spain. In this case, you would report this income in Germany.

What about inheritance?

Some double taxation agreements have clauses that specifically govern what tax rules there are around inheritance that a German resident might get from abroad.

In general, the inheritor will still have to pay inheritance tax in Germany, but could see their tax liability reduced if tax already has to be paid abroad.

There are also other exceptions possible, such as if a child receives a property in their parent’s will and then proceeds to live in it for at least 10 years after they acquire it. In this case, they may not need to pay any tax on it.

In certain complicated cases – or if you have any doubt – it may be a good idea to seek out the services of a professional tax advisor who can make sure you don’t get in trouble with the Finanzamt (tax office). 

READ ALSO: Do foreigners owe tax in Germany on money that is inherited from overseas?

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