When keeping books in electronic or paper form and other required records in electronic or paper form within the meaning of paragraphs 3 to 5, the following requirements must be observed:

• Principle of traceability and verifiability (see 3.1),

• Principles of truth, clarity and continuous recording (see 3.2):

  • Completeness (see 3.2.1),

  •  Individual recording obligation (see 3.2.1),

  • Accuracy (see 3.2.2),

  • timely bookings and records (see 3.2.3),

  • Order (see 3.2.4),

  • Immutability (see 3.2.5).

Paper documents are converted into electronic documents by means of image capture (see paragraph 130). The process must be documented. The taxpayer should therefore create an organizational instruction that regulates, among other things:

• who is allowed to record

• at what point in time it is recorded or should be recorded (e.g. when the mail arrives, during or after the completion of the transaction processing),

• which documents are recorded,

• whether visual or content-related conformity with the original is required,

• such as quality control for readability and completeness and

• how errors should be logged.

The specific design of this procedural documentation depends on the complexity and diversification of the business activity and the organizational structure as well as the IT system used.

Immediate data access (Z1) - The tax authorities have the right to access the IT system directly in such a way that they can view the data that must be recorded and retained in the form of read-only access and use the hardware and software used by the taxpayer or a commissioned third party to check the stored data, including the relevant metadata, master data and transaction data, as well as the corresponding links (e.g. between the tables of a relational database).

It may only access the electronically stored data using this hardware and software. This excludes remote queries (online access) by the tax authorities to the taxpayer's IT system.

Read-only access includes reading and analyzing the data using the evaluation options available in the IT system (e.g. filtering and sorting).

Indirect data access (Z2) - The tax authorities can also require the taxpayer to carry out a machine evaluation of the data that must be recorded and retained in accordance with their instructions or to have it evaluated by a commissioned third party in order to then be able to carry out read-only access. Only a machine evaluation using the evaluation options available in the IT system of the taxpayer or the commissioned third party can be required.

Data media transfer (Z3) - The tax authority can also request that the data that is required to be recorded and retained, including the relevant metadata, master data and transaction data as well as the internal and external links (e.g. between the tables of a relational database), and electronic documents and records be provided to it on a machine-readable and analyzable data medium for evaluation. The tax authority is not entitled to download data from the IT system itself or to make copies of existing data backups.

Taxable persons must retain invoices for 10 years.

An electronic signature or time stamp is not required for tax purposes.

Source: https://ao.bundesfinanzministerium.de/ao/2021/Anhaenge/BMF-Schreiben-und-gleichlautende-Laendererlasse/Anhang-64/anhang-64.html