Information about wanted people: RAF search: Do tipsters have to pay taxes on the reward?

This article is adapted from the business magazine Capital and is available here for ten days. Afterwards it will only be available to read at www.capital.de. Like stern, Capital belongs to RTL Deutschland.

Last week the handcuffs clicked in the Berlin district of Kreuzberg. After more than 25 years of manhunt, the suspected RAF terrorist Daniela Marie Luise Klette was arrested. In mid-February, the Verden public prosecutor’s office asked for information about the former RAF members on the ZDF program “Aktenzeichen XY… unsolved”. Immediately after the broadcast, investigators received 161 tips about Klette and her two accomplices.

If one of these tips from the public has led to a successful manhunt, the tipster should be happy about a reward: various authorities have offered a total of at least 150,000 euros for information that leads to the arrest of the accused. But how much is left of such rewards and finders’ fees? Does the tax office still want to deduct taxes from this? Capital asked.

The short answer: No, tipsters don’t have to pay taxes on rewards offered to catch people. They can neither plan nor influence whether a tip actually leads to an arrest. It is a help that can only be provided by chance.

“Therefore, there is no economic connection between the income generated and the underlying performance,” says a spokeswoman for the Berlin Senate Department of Finance. Services such as tips and advice are not covered by the Income Tax Act because they are not related to the intention to generate income. In German: Because whistleblowers have no concrete influence on whether they are correct and receive the reward, the tax office cannot ask them to pay.

“In this sense, tipsters do not provide a service over a longer period of time, which is why their remuneration remains tax-free,” says tax lawyer Heinz-Willi Kamps. “This can be compared, for example, with winning the lottery, which also remains tax-free. The luck factor predominates here.”

The same applies to a finder’s fee, which attentive people receive if they accidentally find something and hand it over to the owner. Here coincidence is in the foreground. Finders are even entitled to a fee according to the Civil Code: For items found with a value of up to 500 euros, finders can demand five percent of the property’s value from the owner as a finder’s fee.

Meanwhile, the search for Daniela Klette’s accomplices continues at full speed. The Verden public prosecutor’s office and the Lower Saxony State Criminal Police Office continue to ask the public for help in finding the two men. The wanted page of the Federal Criminal Police Office (BKA) contains extensive information about the suspected former RAF terrorists Ernst-Volker Staub and Burkhard Garweg. The investigating authorities also specifically target the families of the accused, their circle of friends and former RAF supporters.

Attentive private individuals still have the chance to collect part of the reward with crucial tips. The Lower Saxony State Criminal Police Office accepts relevant information by telephone and email. Tips can also be submitted confidentially via a secure internet system.

However, the BKA warns against carelessness and advises against approaching the wanted people: “They could be armed!” The authorities accuse Staub, Klette and Garweg of attempted murder and a series of serious robberies between 1999 and 2016. The crime scenes were therefore in Lower Saxony and North Rhine-Westphalia. The trio were part of the so-called third generation until the Red Army Faction (RAF) was dissolved in 1998 and have been living underground since the 1990s.