No access of the tax office to data of a PC cash register

If a pharmacist voluntarily keeps a file created by his PC cash register with individual records of cash sales in addition to the determination of daily receipts by means of end-of-day total receipts, which is permissible according to case law, he is generally not obliged to submit this file to the tax office during a tax audit.

This was decided by the Hessian Fiscal Court (Case No.: 4 K 422/12).

The complaint was filed by a pharmacist who recorded the cash receipts of her pharmacy with a so-called PC cash register. She determined the daily cash receipts by means of continuous end-of-day total receipts (Z receipts) with subsequent zeroing of the cash register memory. The sum of the daily cash receipts was manually transferred to the cash book, which was the basis of the bookkeeping. She did not comply with the auditor's request to also submit the electronic file with the individual records of the cash sales. Although she submitted a CD with data from her cash register system to the auditor, she had removed the file with the individual documentation of the sales.

The Hessian Fiscal Court ruled that there was no legal basis for the tax office's request to also submit the file with the individual records of cash sales. This was because for the plaintiff, who did not supply to other commercial enterprises but to end consumers, there had been no obligation to record the individual cash sales manually or on a data carrier due to the size and the frequency of individual sales, neither according to the German Commercial Code nor according to the German Fiscal Code nor according to professional regulations. The plaintiff could also rely on the case law of the Federal Fiscal Court according to which it was not necessary, for reasons of reasonableness and practicability, to keep individual records for proper bookkeeping even in the computer age, if the entrepreneur - like the plaintiff pharmacist - sold goods of low value to an indefinite number of customers in an open shop against cash payment. In such cases, it was sufficient to dispense with individual records and to transfer the daily totals to a cash book on a daily basis. The keeping of the cash book was intended to replace the disputed individual records.

The fact that the plaintiff had nevertheless voluntarily and programmatically recorded and saved the individual cash sales in a separate file did not change this and did not lead to an obligation to submit the file to the tax audit. This was because the file was not, in principle, part of the basic records to be kept according to § 147 of the German Fiscal Code (Abgabenordnung). The fact that the file could be helpful and interesting for the tax office when checking the compulsory records was irrelevant. For the pharmacist's business, the separate recording of outgoing goods and income was not necessary. However, the legislator was free to create a legal right of access to data created by the taxpayer outside of a legal obligation to keep records, following the Austrian model.

The Hessian Fiscal Court finally clarified, however, and with practical relevance, that the question at issue here of the existence of a duty to submit records pursuant to § 147 of the German Fiscal Code (AO) must be strictly separated from the question of the otherwise recognisable irregularity of the bookkeeping and the resulting power of the tax office to estimate the taxable amount pursuant to § 162 of the German Fiscal Code (AO). Thus, improper cash records (e.g. differences between the daily totals according to the Z receipts and the entries in the cash book or the untimely keeping of the cash book) allowed the conclusion that not all cash receipts had been booked and entitled the tax office to make estimates.


Source: Press release of the Hessian Fiscal Court


Goldberg Attorneys at Law 2013

Attorney at Law Michael Ullrich, LL.M. (Information Law)

Specialist lawyer for information technology law