Binding Information in The Mt.Gox Case

Binding information is the possibility of obtaining a written assessment of the legal evaluation of a matter from a German tax authority via a corresponding request. The public authorities are bound by this assessment when taxing for the future.

The law, in particular tax law, is familiar with many areas in which the individual case does not clearly fall under the legal regulations. Since taxpayers must nevertheless be given the opportunity to plan for contingencies, they can receive a statement from the tax authority as to how it classifies these circumstances for tax purposes after presenting the concrete facts. In doing so, the applicant receives a binding commitment from the authority. This means that if the requested facts are realized in this way, the tax office must also implement the promised legal opinion in the future.

First of all, there needs to be a legal problem. In this case, this would be the tax treatment of the repayment of bitcoins or the disposal of the claim from the assets of Mt.Gox. The facts underlying this problem must be presented to the tax office in a concrete and detailed manner.

Following this, we present what we believe to be the appropriate solution to this problem. This leads to a concrete legal question that must be answered by the tax office. Finally, formal regulations must still be observed:

• The facts of the case must not yet have been realized.
• The applicant must have a special interest; it must not be a mere trivial matter.
• The aim of the request must not be to achieve a tax advantage.
• Presenting the facts to another authority is not permitted.

In addition to the consultation costs, the costs of the binding information are assessed according to its value to the applicant. That is, it compares the position we represent with the tax implications of the opposing view. The difference is called the object value, from which the fee is calculated.

If, for example, one assumes that taxes in the amount of EUR 2,500 are due on the basis of the submitted opinion, but the opposing view arrives at a tax of EUR 10,000, the object value is EUR 7,500.

If no meaningful value can be taken from this comparison, the tax office can also charge according to a time fee.

To cut to the chase: Legal and planning security.

• The taxation of cryptocurrencies is a young and, so far, minimally established field of financial administration. This alone gives rise to many ambiguities and divergent views in taxation. As a result, persons holding claims against Mt.Gox cannot, with any certainty, expect the tax burden to be borne.
   
• The case of Mt.Gox creates a clash between highly complex Japanese insolvency cases and German tax law, leading to challenging overlaps. To be able to understand clearly here what effect the decision between the repayment methods or even a possible sale will have on the tax to be borne, one cannot obtain more certainty than through the assurance of the tax office.
   
• We will present your facts to the tax office according to the manner you have planned (or in different variants) and examine them from a legal standpoint. After receiving a reply from the tax office, you can be certain about what to expect, and you will have the opportunity to decide how to proceed.