New Tax Audit Regulations (ApO): More focus on risk and significantly expanded duties of cooperation

Background and goal of the new Tax Audit Regulations

On 23 March 2026 the Federal Ministry of Finance (BMF) published the “Draft of a General Administrative Regulation of the Federal Government for Tax Audits – Tax Audit Regulations” [Entwurf einer Allgemeinen Verwaltungsvorschrift der Bundesregierung für die Außenprüfung – Außenprüfungsordnung (ApO)]. These new regulations (ApO) are intended to replace the current regulations known as the Betriebsprüfungsordnung (BpO) from 2000.

This goes back to an amendment to the German Fiscal Code (Abgabenordnung–AO) made by an amendment to the law from 20 December 2022 (Gesetz zur Umsetzung der Richtlinie (EU) 2021/514 sowie zur Modernisierung des Steuerverfahrensrechts).. The goal of this amendment was especially to speed up tax audits.

The draft integrates the new statutory rules in a revised and restructured form and includes further regulations to increase efficiency and to improve collaboration between the tax audit offices of the Federal states and the Federal Central Tax Office (BZSt).

The new Tax Audit Regulations are to come into force on the day after they are published in the Federal Tax Gazette (Bundessteuerblatt–BStBl).

The main changes planned in the new Tax Audit Regulations

Selection of cases based more on risk 

In future, audit cases are to be selected more on the basis of risk criteria (section 2 of the draft ApO), including digital evaluations and national and international risk assessment procedures. 

Sooner and “slimmer” audits

Tax audits are to start sooner after the end of the assessment period under audit (section 2(3)). Provision is made for smaller enterprises to restrict the audit period to a maximum of three tax periods (section 5(2)).

Binding conditions

To arrange and speed up the audit procedure, in future the tax authorities and businesses will be able to make binding agreements on the procedure, communication methods and deadlines (section 8).

Reinforcing of duties of cooperation

The qualified requirement to cooperate under section 200a of the Fiscal Code is more clearly regulated and becomes more important (sections 9(4) and 24(4)). In future, companies will have to provide documentation more completely and sooner.

A greater role for the Federal Central Tax Office (BZSt)

The Federal Central Tax Office (BZSt) will be more strongly involved in audits (with its own section IV in the draft ApO), particularly for cross-border transactions, international tax arrangements and VAT matters. 

Coordinated payroll tax audits

Section 21 of the draft ApO introduces a group-wide or enterprise-wide coordinated payroll tax audit for the first time. The condition for this is a revenue threshold of EUR 50 million (section 14) and the number of 10,000 employees. Furthermore, it also lays down coordinated audits for close economic interrelationships or uniform control. 

Potential impact in practice

The new Tax Audit Regulations are supposed to focus the tax authorities more strongly on a risk-based procedure. In future, companies with potentially higher tax risks will have to deal with more frequent and intense audits, while some of the burden may be taken off other companies. This may particularly affect VAT, particularly at international companies with a large number of transactions.

Audits being carried out sooner could have advantages because matters will be more traceable and errors will not continue for years. At the same time, companies will have less time to prepare or make corrections internally. Also in light of the duty to report and make corrections under section 153(4) of the Fiscal Code, quickness remains a critical factor.

The stronger role of the Federal Central Tax Office (BZSt) becomes more important to companies operating across borders. There may in future be more focus on international matters, such as intra-Community supplies, chain transactions and supplies covered by the One-Stop-Shop scheme.

There are also extensive regulations on coordinated payroll tax audits (section 21), including competence, coordination with group tax audits and exchange of relevant findings. In addition to this, the draft lays down the introduction of an employer audit file (section 32) and permanent establishment summaries for payroll tax (section 33(2)).

However, it does not include any details on the piloting of alternative audit methods under Art. 97 section 38 of the Introductory Act to the Fiscal Code (Einführungsgesetz zur Abgabenordnung–EGAO).

Conclusion and recommendations for practice

Companies already face extensive duties related to tax to cooperate and present information, including access to electronic documents and emails relevant to tax. The new Tax Audit Regulations reinforce this trend.

It can also be expected that the use of the new field code 500 in the forms for VAT preliminary returns and annual returns from 2026 will lead to targeted control and in-depth auditing by the tax authorities (see our Insight on this).
Current Federal Court of Justice (BGH) case law has to be regarded here, according to which erroneous preliminary and annual VAT returns may be considered as separate offences under tax law.

Overall, companies have to deal with tax audits in future being more frequent, faster and more specific. Areas that are prone to error, such as cross-border revenue and payroll, will come under even more scrutiny. At the same time, internal processes, the availability of data and reaction times are becoming much more important. If cooperation is late, a penalty for delayed cooperation may be imposed, as well as a surcharge of up to EUR 3,750,000, where applicable.

To be prepared for these requirements, companies should check whether their tax processes and systems match the new rules. An efficient tax control framework plays a central role here. Alongside this, specific Tax Health Checks can help to identify VAT and payroll risks.

Grant Thornton Germany supports companies with analysing and optimising tax processes, setting up and developing a tax control framework and with health checks – ideally before a tax or VAT audit. We’re looking forward to hearing from you!