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In the hospitality industry, the preparation and handling of interim bills entail a risk of criminal tax liability—particularly if such bills are deliberately omitted from the cash register system or recorded late, thereby preventing the corresponding revenue from being included in the accounting records.

1. Objective elements of tax evasion

Courts consider the objective elements of tax evasion under Section 370 (1) of the Fiscal Code (AO) to be met when revenue is not declared (or not fully declared) over an extended period, or when cash management and record-keeping practices are structured to conceal actual sales and result in the underpayment of VAT and income taxes.

Typical scenarios involve:

• manipulatable cash registers,
• failure to retain daily closing reports (Z-reports),
• deactivated journal functions, or the use of cancellation/training modes to systematically remove sales transactions from the records.

2. Intent is readily affirmed

Established case law holds that "conditional intent" (bedingter Vorsatz) is sufficient to establish intent; it is required only that the taxpayer considers it at least possible that a tax liability exists (regarding both the basis and the amount) and accepts the resulting tax shortfall. A layperson’s understanding of the situation (Parallelwertung in der Laiensphäre) suffices; specialized tax knowledge is not required. In hospitality cases where cash registers are deliberately programmed or used so that sales (such as those from interim bills) are excluded from the daily closing figures and collected as "off-the-books" cash, both the Federal Court of Justice (BGH) and the Federal Fiscal Court (BFH) regularly affirm the existence of intent.

3. Distinction from negligent tax underpayment

Conversely, courts clarify that mere organizational shortcomings in cash management (e.g., accounting that is disorganized but not designed to conceal revenue) do not automatically constitute tax evasion; a finding of intentional tax underpayment based on the overall circumstances is required. Where the tax authorities cannot establish the subjective element of the offense, the only possibilities are negligent tax underpayment under Section 378 of the Fiscal Code (AO) or a mere violation of record-keeping obligations (e.g., Section 379 AO).

4. Conclusion

If interim invoices are used as a deliberate tool to avoid recording sales (e.g., accumulating amounts on interim invoices followed by cash collection without entering the transaction into the cash register system), the threshold for intentional tax evasion under Section 370 AO is typically crossed. Conversely, in cases involving an organization that is clearly overwhelmed—lacking a discernible "system" or cash register programming designed to conceal revenue—the offense may amount to nothing more than negligent tax underpayment. The decisive factors are the overall circumstances of the individual case and the burden of proof borne by the tax authorities.

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