(2021) Maintenance payments to relatives abroad: Strict proof requirements apply!

Many foreign nationals living and working in Germany support their relatives abroad. However, individuals with a foreign spouse also provide maintenance to their spouse's relatives. For maintenance payments to relatives abroad, the tax office has imposed stricter requirements on proof of payments and the recipient's need since 2007.

Recently, the Federal Fiscal Court rejected maintenance payments to parents living in Indonesia because need was not sufficiently proven. Certificates of need for adult maintenance recipients must include detailed information about income received before the start of support.

Given the limited ability to verify circumstances abroad, comprehensive information is essential. It is generally reasonable to provide fully completed certificates (BFH ruling of 07.05.2015, VI R 32/14).

The case: The son living in Germany supported his parents in Indonesia with 5.000 Euro. He presented two documents from the municipal administration (Indonesia) to the tax office, stating that his parents do not receive a state pension as civil servants or public employees. Subsequently, he provided another certificate stating that the father is not employed, has no income of his own, and does not receive a pension. However, the BFH did not consider this sufficient proof of the parents' need.

The BFH is very strict here: The judges criticised that the submitted "maintenance certificates" from the municipal administration (Indonesia) were incomplete in essential parts. In particular, there was no information about income received by the parents before the start of support and thus no information on how they supported themselves before the son's maintenance payments began.

Furthermore, the submitted certificates from the municipal administration were incomplete as they did not provide information on the parents' financial situation, such as (owner-occupied) property. These certificates only excluded own income and receipt of a pension (as civil servants or public employees) but said nothing about other income, e.g. from rental. Therefore, the information contained in the certificates could not be used to conclude their need.

Lohnsteuer kompakt: However, the BFH allows for some relief: The fulfilment of obligations to clarify the facts and to provide and obtain evidence must be possible, reasonable, and proportionate. For example, in cases of civil war, evidential relief regarding the procurement of official certificates may be considered.